Be very afraid

Queen

It’s not lust. Nor greed nor hunger. Fear is the great motivator. It drives people from their logical path. Makes them believe the worst. Renders them impotent.

Since the news broke that depositors in little Cyprus would be taxed to finance a bank bailout, the value of Bitcoins, for example, has soared. The digital money (which is really a commodity) traded at five bucks a pop two years ago and is now near $140. This past week the market value of Bitcoins passed $1 billion, even though you can’t use them at Loblaws or Petro-Canada or the liquor store. But you can buy drugs and weapons online. Go figure.

Digital money, not issued by any country, backed by no government and unencumbered by interest rates, is hot these days among the young and mistrustful who last year botched the Occupy movement. It’s as much an anti-bank thing as a strategy to protect wealth. It’s cool, and like Psy, likely going nowhere.

But it’s the latest manifestation of a fear that runs right back to the meltdown of 2008. The same terror spawned the real estate rush in Canada. After all, houses always go up, right? Homer Simpson ran screaming from the bursting equity market bubble to create a new one with real estate. Now the very nature of money and bank accounts is being questioned, simply because human nature makes us devour bad news.

In the last few days, late to the meme as usual, the MSM has been rumping the Cyprus story with the new Canada twist. CBC did it. The Toronto Star did it. Expect more. The warning is simple and gripping: if authorities in little Cyprus can hollow out bank accounts to rescue a failing bank or a smashed economy, why can’t it happen here?

F walked right into that one. Days later the new budget came out, with a supplementary document describing a ‘bail-in’ rescue mechanism if a Canadian bank ever went assets-up. It talked about converting bank ‘liabilities’ into operating capital, instead of having taxpayers save a too-big-to-fail institution. The suspicious, mistrustful and naive among us (including those who hate banks, love gold or fall for Bitcoins) immediately interpreted ‘liabilities’ as being the savings of depositors. This, as Ottawa made clear two days ago, ain’t so. But why spoil a good fright?

In the last week realtors have used their Facebook pages to suggest that when (not if) the banks fail and your money is stolen, you’ll wish you’d bought a house. The silver-and-gold nuts have suggested if Ottawa thinks a bank can fail (it doesn’t) you need to put all your wealth into rocks. Said prime Canadian bullion-humper Eric Sprott, in a passage that pretty much finishes off his waning credibility:

Governments around the world are finally beginning to realize the gravity of the risk that exists in their banking sectors. The EU has decided to build upon the new template of the “bail-in” regime. The US, UK and Canada have all followed suit. This puts the onus squarely upon the depositor. The depositor is a lender to the financial institution that he banks with. However, most depositors naively assume that their deposits are 100% safe in their banks and trust them to safeguard their savings. Under the new “template” all lenders (including depositors) to the bank can be forced to “bail in” their respective banks. The Greek tragedy is now being played out in Cyprus with a new twist as depositors have been unwillingly turned into sacrificial lambs. We strongly believe that real assets trump a fiat currency in a “savings” account. It is not our intention to be alarmist here, merely to say, “caveat depositor”.

Added the CBC’s ace reporter Neil McDonald: “In the ever-more insecure world that has unfolded since the financial meltdown of 2008, it is also increasingly clear that nothing is safe anymore, not even blue-chip bank stocks and bonds or even, in the case of the Cyprus bail-in, private bank accounts. And now, Canada is making a bail-in official government policy, too…. if Ottawa is seriously contemplating the failure of a Canadian bank, ordinary Canadians might want to do the same, and govern themselves accordingly.”

Said the Star: “Be prepared. If you hold the wrong kind of bank accounts, Finance Minister Jim Flaherty may have your savings in his cross-hairs… The new rules would allow federal regulators to seize unspecified bank liabilities — including, perhaps, the savings of uninsured depositors — and use them to prop up a faltering institution. Which, as it turns out, is exactly what Cyprus’ government did to deal with its banking crisis.”

See what I mean? A fear fix.

What are the facts?

“The bail-in scenario described in the Budget has nothing to do with depositors’ accounts and they will in no way be used here,” says the Finance Department. “Those accounts will continue to remain insured through the Canada Deposit Insurance Corporation, as always. If a bank is having severe difficulties, the bail-in regime would force certain debt instruments to be converted into equity to recapitalize the bank.”

That seems clear enough. But what ‘certain debt instruments’ are they talking about?

As I outlined last weekend, not a cent of depositor money – insured or uninsured – would be eyed in the (incredibly unlikely) event of a big bank flop. Instead, banks will likely soon be required to set aside ‘contingent capital’, such as a special class of shares or ‘bail-in bonds’ which pay investors a heightened rate of interest. These could be quickly turned into cash to shore up a staggering bank in the event of a crisis. The main point is to stop any ‘systemically important’ bank from thinking it is so big and vital to the economy that taxpayer money will be there to save its ass. Instead, it has to save itself.

When that unsecured debt hits the market, you can be sure it’ll be gone in a flash, gobbled up by people who know what to fear. And it’s not losing money.

259 comments ↓

#1 benchwarmer on 04.04.13 at 7:52 pm

FIRST!

#2 North Van Renter on 04.04.13 at 7:59 pm

So, in the unlikely event of a of a big bank flop, what would be targeted first, bail-in bonds, or stock?

Securities designated as contingency capital. Undoubtedly the bonds. But it will never happen. — Garth

#3 My thoughts on 04.04.13 at 7:59 pm

Garth, it’s all the same houses that are on the market year after year… Even flippers are admitting that nothing is moving. Something has definitely changed and trying to scare people with these fb posts is just another tactic. It’s the summer of change. It’s like a drum beat getting louder and closer signaling the end of the game.

#4 Josef on 04.04.13 at 7:59 pm

First!!! Oh Yeah BABY!!!

#5 e4me on 04.04.13 at 8:13 pm

Garth has been known to be in the past part of the “establishment”. Since when does the average Canadian add any credibility to any Government Dept (Finance Ministry) and expect to hear 100% of the truth as to how safe Bank deposits.

When it’s true. — Garth

#6 Stomper on 04.04.13 at 8:14 pm

Bitcoins…. with as much intrinsic value as Tulips.

#7 Freebird on 04.04.13 at 8:20 pm

Garth, how rude of you, taking the wind out of our MSM news networks attempt at sensationalism to attract viewers. They have to stir up something to write/talk/ debate about, right?

#8 sue on 04.04.13 at 8:21 pm

It’s running out of money. Do I get a gold star?

#9 visorman30 on 04.04.13 at 8:23 pm

This post brings up a good point in that news media and the public are just jumping from one thing to the next. 2008 was a giant stock market scare, now its the bank deposits, next is who knows what, maybe Somalian pirates or something. All this is based on selling fear.

Btw Garth, took your advice on a balanced portfolio and moved in some cash into a TFSA using a model portfolio from CanadianCouchPotato (Bonds, Canadian Equity, US and International) is there anything else I should add? The size of the TFSA is modest ($10k) but I plan to add as I can.

#10 espressobob on 04.04.13 at 8:29 pm

Thanks Garth for another great post! As contrarian investors ‘fear’ presents good buying oportunities. Oh, and the bitcoin should be renamed the ‘ Sprottcoin ‘, should provide the same results.

#11 Sebee on 04.04.13 at 8:31 pm

Bitcoin…perfect for Groupon.

#12 Smoking Man on 04.04.13 at 8:31 pm

Vlad, what’s up you on vacation again………

Miss the links brother….

#13 An Importation To Prop The Ponzi Scheme on 04.04.13 at 8:32 pm

Convertible bonds are nothing new. Why budget for them?

Contingency, not convertible. — Garth

#14 Jake on 04.04.13 at 8:35 pm

After 4-5 months of no sale in this building, this condo was listed almost 80k down from similar units. That’s 30% price drop from the peaks these condos were sold last year.

http://www.realtor.ca/propertyDetails.aspx?propertyId=13008575&PidKey=-1673028670

#15 Tom Vu on 04.04.13 at 8:36 pm

DELETED

#16 Jake on 04.04.13 at 8:37 pm

And the dreamers in this building:

http://www.realtor.ca/propertyDetails.aspx?propertyId=12841882&PidKey=-1206593673

http://www.realtor.ca/propertyDetails.aspx?propertyId=12834874&PidKey=2115464936

#17 Smoking Man on 04.04.13 at 8:39 pm

#5 e4me on 04.04.13 at 8:13 pm

Garth has been known to be in the past part of the “establishment”. Since when does the average Canadian add any credibility to any Government Dept (Finance Ministry) and expect to hear 100% of the truth as to how safe Bank deposits.

When it’s true. — Garth

Your a goof, first off the only reason I grace this sight with my greatness is because Gartho is a man, the only one I know of who showed harpo the middle finger.. Who the fk is harpo to tell him he can’t have a blog.

Second we have the luxury of coming on here with fake names and spew our bull shut to each other.

He don’t have that luxury, mind you I don’t think it would make a difference, Gartho is a man, says what he wants with his real name attached, consequences be damnd…

How can you Chirp that….

#18 Eleventh yeah baby!! on 04.04.13 at 8:40 pm

Eleventh, yeah baby!

#19 Weener on 04.04.13 at 8:43 pm

Good luck to those who read The Star for financial advice… Is that another area of expertise for Rosie DiManno?

#20 Tom from Mississauga on 04.04.13 at 8:49 pm

Banks are making a fortune. Why would anybody worry? But people looking to unload physical G&S will be pumping this big time as they look to get out.

http://www.bloomberg.com/news/2013-02-17/gold-death-cross-signals-price-slump-as-soros-sells.html

#21 MSM Observer on 04.04.13 at 8:51 pm

Garth, I use to read your blog daily and I’ve read all sort of media manipulation tales on it. I work for the MSM and sometimes I find excessive what people comment in this blog. But today I had a very disappointing experience that comes to support these theories…

Early in the morning I was reviewing our daily news (yes I work for this media company) and I was glad to read a news headline saying “Le prix des condos diminue légèrement à Montréal” (yes I live in Montreal and unfortunately there is no English version for this news). I copied the web address of the article and sent it to a relative that is willing to buy (and I have begged to wait for the market to crash). To my surprise a few minutes later this person answered back to me saying the web address was not available. Long story short… the paper I work for had just doctored (censored, manipulated) the content of the article, and changed the “approach”.

What was originally published as a decline in prices for condos in Montreal was now viewed as a slight progress in the prices.

Here is a screen capture of the original article: http://postimg.org/image/v81ttjmtd/

Here is a screen capture of the doctored article: http://postimg.org/image/ivyxg1yyp/

You will immediately see the dramatic change in the article’s title, but in addition I took the time to highlight in yellow the main differences between the two versions.

The original web address (http://argent.canoe.ca/vos-finances/immobilier/le-prix-des-condos-diminue-legerement-montreal-4042013) is not available anymore; you will get a message saying the page is not found. I couldn’t even find it in the Google cache; I guess it was online only for a few minutes. I send it here anyways, maybe some IT geek can recover it.

The web address for the new altered version is this (http://argent.canoe.ca/vos-finances/immobilier/le-prix-des-maisons-progressent-legerement-montreal-4042013)

The way the MSM (and the entire real estate industry) is manipulating the people is just disgusting.

Your blog has valuable financial advice, entertaining articles and comments, and lots of good things but what I love the most about it is that it is an eye opener, no BS, no manipulation. Keep the great work.

#22 Alyce in Wonderland on 04.04.13 at 8:53 pm

So, in the unlikely event of a of a big bank flop, what would be targeted first, bail-in bonds, or stock?

Securities designated as contingency capital. Undoubtedly the bonds. But it will never happen. — Garth
——————————-
Never is a very long time. Why would they provision it then if it (the ‘unlikely’ event) would never happen?

It is clear that with countries with huge banking sectors and their own currency the choice in certain cases and conditions could be either currency failure or bank failure. F is clearly preparing for the 2nd.

I agree that it looks stupid. But who knows in what derivatives games are our banks involved. And if the US dollar bombs which becomes increasingly likely who know what the impact would be on the world economy and banking sector?

It seems there are 3 huge blocks playing their independent games these days:
1. BRICS
2. Europe
3. US+Canada+Japan+UK (the ‘inflation’ nations)

The 3rd one being in the worst shape. Interesting times coming.

#23 Alyce in Wonderland on 04.04.13 at 8:54 pm

If Russia and China join hands US is doomed.

Sounds like you already are. — Garth

#24 Smoking Man on 04.04.13 at 8:55 pm

Gartho please don’t interpit my endorsement of your rebellious as sucking up…

If I such up anywhere is cause I have a plan and an agenda, I suck up to no man or god, unless they are a mark… A target. Yoda don’t miss interpit that….. Lol

But that guy pissed me off…..

I still hate you Garth

#25 Godth on 04.04.13 at 8:56 pm

Yes, the politicians and their appointees seem very afraid.
http://www.youtube.com/watch?v=Z3zwhp5-jXA

#26 Scott in Gibsons on 04.04.13 at 8:56 pm

Did I miss something?

Garth confirms slowing Canadian RE market

Canadian RE market accounts for large % of Canadian economy

Canadians have record debt levels

Slowing RE causes Canadians to struggle with debt repayment causing stress to Canadian lenders

Canadian lenders are forced to raise capital to cover bad loans

Supposedly savvy investors line up to buy “a special class of shares or ‘bail-in bonds’ ” that are defaulted on by lenders to cover capital requirements

Who the heck would buy these instruments considering the above conditions? What yield is required to lure investors? How does the cost of this program impact lenders? How much money are we talking about being raised in this way?

This is not as cut and dry as Garth says. Governments pass laws like this to cover their butts in the future. They see a risk even if Garth doesn’t. Keep an eye on this, we live in interesting times. Many things “that will never happen”, have.

#27 Alyce in Wonderland on 04.04.13 at 8:56 pm

The fact that there is such strong opposition against commodities is very suspicious. Some topics are prohibited these days in the media. One wanders why. It looks orchestrated for sure. Brings me chills.

#28 Alyce in Wonderland on 04.04.13 at 8:58 pm

Sounds like you already are. — Garth
———————————–
Not yet. But hey, know knows.

#29 Alyce in Wonderland on 04.04.13 at 8:58 pm

damn spellchecker. Who knows.

#30 Tom Vu on 04.04.13 at 8:59 pm

#15 Tom Vu on 04.04.13 at 8:36 pm

DELETED

===========

WTF ?

No *&%$ soup for you.

PS my boat crew can help you choose blog photos

#31 groovin_123 on 04.04.13 at 9:02 pm

It would appear Eric Sprott has been bang-on all along.

Wow. I’m shocked. Just shocked. Who would’ve thunk doubling, tripling, quadroupling one’s monetary base would go so wrong?

And the devaluation race takes a new leg-up with Japan dropping one heck of a QE-bomb last night…. How long before $100 won’t even buy you a loaf of bread? But that doesn’t matter, none of that contributes to our current era of “deflation”…. we can always eat I-Pads, right?

What a joke.

#32 Sam Cheung on 04.04.13 at 9:03 pm

Your blog has valuable financial advice, entertaining articles and comments, and lots of good things but what I love the most about it is that it is an eye opener, no BS, no manipulation. Keep the great work.
——————————————-

It seems Garth is loosing the contrarian views and is becoming increasingly mainstream….

Just telling the truth, dude. — Garth

#33 Weener on 04.04.13 at 9:04 pm

Ahahahaha…. look at what landed in my Inbox. Not sure how the idiot got my email address.

First Time Home Buyers Seminar

when: Saturday April 13th 2013 10:30am
where: 1550 South Gateway Rd Unit 301 Mississauga On L4W 5G6
rsvp by email to reserve a spot

• Are you thinking about buying a home?
• Are you in the process of buying a home?
• Are you interested in a rebate from the government?
• Are you looking for information on purchasing a home?

Then join us for a Home Buyers seminar and learn from leading experts all the information you need to know!

Sincerely,
David So
Your MONEY consultant … for life
Author/Speaker: “Four Steps To Financial Peace”.

Are you tired of the rat race? The more money you earned, the less you seems to have. You need to learn about “The Money Game.” Whether you like it or not, you are playing the money game. Leverage you mortgage as an asset, instead of treating it like a liability. Call NOW to book your coaching session!

Don’t Work For Money! Let MONEY Work For You!

David So – Mortgage Broker
Lic # 10223
Canadian National Mortgage Corporation

David So – ranked Canada’s Top 50 brokers, by CMP magazine.

I normally return phone calls Monday through Friday from 10-11 am or 2-3 pm. I am also available for Client consultations by appointments only on Tuesday, Wednesday and Thursday. Monday and Friday are my remodel time where I spend time on improving our business system to offer you world-class service. Saturdays are my family days. Sunday, The Lord’s day, I am not available for business.

#34 (former) hippy on a gulf island on 04.04.13 at 9:09 pm

Why did you change the opening photo?

I like the current one, but the first one was exceptional.

#35 Smoking Man on 04.04.13 at 9:15 pm

#21 MSM Observer on 04.04.13 at 8:51 pm

Welcome my son to the machine………

Five banks, 2 airlines, monopoly insurance industry.. Fight all you want, or infiltrate and profit take…. Is my shtick….

Last year I called if the Real Estate slow down took hold, over correction. MSM would blow sunshine…..

Welcome grasshopper too the machine…. Speaking of which, I’m amped, pink Floyd cover band at senica tomorrow night….. Can’t wait…

#36 jason on 04.04.13 at 9:18 pm

#13 The banks could also issue COCOs

#37 Dr. Oblivious on 04.04.13 at 9:18 pm

I got to go buy a laptop so I can read this blog from under my covers (and maybe smoke too).

Certainly you are right, this is a lot of misplaced hysteria. I guess we love a good scare though.

#38 Dean Mason on 04.04.13 at 9:19 pm

There is a reason why CDIC has a $100,000 maximum insured deposit limit for banks,trust companies etc. DICO also has a $100,000 maximum insured deposit limit for credit unions as well as other provinces have their own maximum deposit limits for credit unions.

I would never put more than the maximum $100,000 in any financial institution because if things go wrong the uninsured depositors are the first to get burned and pay for it. They are telling you that there is no protection over $100,000 in their bank so it’s not like their lying to you.

I know there are different ways to increase the $100,000 limit with joint,single,trust accounts,RRSP’s, RRIF’s,TFSA’s,RESP’s but you must know the rules after all it’s your money so who is going to look after it better than you would.

These deposit insurance regulations for banks,credit unions,trust companies were implemented precisely to stop run on banks and get back trust from depositors and banking again. Cyprus proposed deposit bank tax tried to go around that and breach the E.U.’s deposit insurance of $100,000 maximum limit but it failed.

If there was no deposit insurance people would be skeptical of depositing money in banks,credit unions,trust companies,mortgage companies etc.They can’t go back to the old days with no banking regulations.

The CDIC,DICO and other deposit insurance regulations across other provinces all require Canadian dollar deposits so foreign deposits like U.S. dollars, U.K. pounds,Euros are all uninsured from the first dollar.People need to get more informed and educate themselves about where,what and how their money is invested and the regulations,rules that govern them.

#39 kevin on 04.04.13 at 9:22 pm

(my comment from yesterday)

Garth, Do you have any comments on bitcoin?

Why would I? — Garth

~

Looks like you do in fact have a few things to say about bitcoin after all! ;)

#40 henry on 04.04.13 at 9:26 pm

Just to be safe it is probably best to not have investments in a bank (stocks or otherwise). Get a questrade account. And with them you can also buy gold and take delivery if needed.

Insane advice. — Garth

#41 Joe on 04.04.13 at 9:27 pm

Print print print now Japan’s onboard, all this will do is continue to devalue the dollar and usher in more inflation and then hyper inflation. The problem with gold and silver is the Fed(privately) owned is controlling the markets. It’s the golden rule. He who has the gold rules. This will not end well when the smoke clears.

Gold down 18 per cent. Some rule. — Garth

#42 FTP - First Time Poster on 04.04.13 at 9:32 pm

Hey Garth – weren’t you part of the government that said that trusts wouldn’t be touched either? What ever happened with that? If memory serves me correct….oh yaaaaaaa…..

No.– Garth

#43 Gladiator on 04.04.13 at 9:32 pm

Garth, what are bank liabilities, besides deposits? And aren’t average Joe’s deposits the lion’s share of bank liabilities? Would you please shed some more light on it?

I did. — Garth

#44 X on 04.04.13 at 9:33 pm

The media and reporters are doing a great job ruining their own credibility. Is it any wonder their readership is continuing to decrease.

#45 espressobob on 04.04.13 at 9:34 pm

#27 Alice in Wonderland
#31 grooving_123

In case you overlooked tonights post It is obvious to some of us that fear and confidence can have an adverse affect on your investment decisions. Why not consult an advisor and stop worrying!

That could be your best investment.

#46 vancouverite on 04.04.13 at 9:39 pm

Dean Mason on 04.04.13 at 9:19 pm
There is a reason why CDIC has a $100,000 maximum insured deposit limit for banks,trust companies etc. DICO also has a $100,000 maximum insured deposit limit for credit unions as well as other provinces have their own maximum deposit limits for credit unions.

———————
In BC, there is no upper insured deposit limit at the credit unions. Hence, one can sell his or her house in Vancouver for $1 million and deposit the money into a BC credit and all of it would be insured.

http://cudicbc.ca/

#47 Pretntious Tofino Bicycles on 04.04.13 at 9:41 pm

Print print print now Japan’s onboard, all this will do is continue to devalue the dollar and usher in more inflation and then hyper inflation.
————————
Bollocks. What about the effect of deflation from tinfoilers like yourself who are buying gold, bullets and bog roll instead of spending their dollars on cars, TVs, clothes and other things that people who don’t live their lives in fear purchase?

When Inflation = Deflation you get stagnation.

#48 AK on 04.04.13 at 9:41 pm

#27 Alyce in Wonderland on 04.04.13 at 8:56 pm

“The fact that there is such strong opposition against commodities is very suspicious.”
——————————————————————-
Not to worry. In another 85 years, Gold will be back to $1,900.00. :-)

#49 Humpty Dumpty on 04.04.13 at 9:43 pm

You forgot to add these guys to your credibility list…

Al Gore… Paul Krugman… Jeff Berwick… Max Kaiser…

http://www.visualcapitalist.com/bitcoin-the-encryption-standard

“By definition, risk takers often fail. So do morons.
In practice its difficult to sort them out”-

Scott Adams, The Dilbert Principle

#50 Nostradamus Le Mad Vlad on 04.04.13 at 9:46 pm

#12 Smoking Man — “Vlad, what’s up you on vacation again………” — Hi SMan, good to hear from you.

Life has been far too busy for us, don’t have the same time as we’re off doing other things.

But we have a very good life. Wednesday, got our tax returns back. I received $8.42, better half got zip which indicates that, despite each other, we actually have a good and balanced time here.

I’ll pop in now and then. Keep them dawgs on their toes!

#51 Alyce in Wonderland on 04.04.13 at 9:47 pm

#27 Alice in Wonderland
#31 grooving_123

In case you overlooked tonights post It is obvious to some of us that fear and confidence can have an adverse affect on your investment decisions. Why not consult an advisor and stop worrying!

———————————
I used a very good financial advisor and did very well lately.
BTW he told me that I know more than the average CFA…
Something in the big picture does not make sense. I think that is to be contrarian means to look at fundamentals and notice things that do not make sense.

Commodity prices do not make any sense to me. As well as the derivatives on certain markets. If it was not for the derivatives we would be looking at a very different world. We live in manipulated markets worlds, there was a research by RBC or Scotia that can directly correlate the money printing to the stock market performance in US with a factor of 0.98. google it.

So the stock market ‘gains’ are driven by money printing. Paul Krugman who stated the opposite looks really small and stupid.

I can’t imagine for how long this screw up of the markets will last, I just have seen how this plays out when the music stops and I have a feeling we are not fare from that moment.

#52 East Van on 04.04.13 at 9:48 pm

“Precious” metals, currencies, real estate, stocks, bonds – none of these thing have any intrinsic value – they have only extrinsic value, and are therefore never “safe” investments.

Love and work and wisdom have intrinsic value.

#53 Alyce in Wonderland on 04.04.13 at 9:51 pm

#48 AK
Not to worry. In another 85 years, Gold will be back to $1,900.00. :-)
———————————————–
Who cares? I don’t own gold.

By the way the people are laughing at the gold bugs the same way they were laughing at Peter Schiff and Garth when they spoke on the housing bubble years ago.

Have you analyzed the gold bugs view point and the data supporting it?

#54 Be very afraid — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate | The Affluent Boomer™ on 04.04.13 at 9:52 pm

[...] Since the news broke that depositors in little Cyprus would be taxed to finance a bank bailout, the value of Bitcoins, for example, has soared. The digital money (which is really a commodity) traded at five bucks a pop two years ago and is now near $140. This past week the market value of Bitcoins passed $1 billion, even though you can’t use them at Loblaws or Petro-Canada or the liquor store. But you can buy drugs and weapons online. Go figure. Continue reading → [...]

#55 Randman on 04.04.13 at 9:54 pm

..not backed by government ….

You say that as if its a bad thing….!

#56 Yuus bin Haad on 04.04.13 at 9:56 pm

I’m going to try burying my cash in the backyard again – I’m hoping the new plastic bills fare better than the old linen ones.

#57 Not 1st on 04.04.13 at 9:57 pm

Garth if there was no worry then the 1% crowd wouldn’t be trying so hard to stash cash in the Caymans or Switzerland or little ol Litchenstein.

As usual you overstate risk in one asset glass and gloss over it in another.

They are tax evaders. not bank avoiders. — Garth

#58 Smoking Man on 04.04.13 at 9:57 pm

#44 X on 04.04.13 at 9:33 pm
The media and reporters are doing a great job ruining their own credibility. Is it any wonder their readership is continuing to decrease.

……………………………………..

Do you think they have a choice…well they do…..do they throw away 50k investment in an obidance certificate, they need to eat and pay off student loans, they need to do and say what the master tells them to do.

Why bust there balls……learn to read between the lines and prosper……..

But then again teacher, said, hounesty, hard work, loyalty = success.

So fking doomed you are all……

#59 Randman on 04.04.13 at 10:00 pm

Hey Garth

I’d like to know how you define the difference between

Hysterical, sensationalist fearmongering

And

Defined warnings of possible scenarios?

After all…everyone thought Noah was crazy!

#60 Pr on 04.04.13 at 10:05 pm

For me its perfectly clear: Its all safe…until its not! Then its to late!

It’s never too late to learn spelling and punctuation. That’ll protect you. — Garth

#61 Alyce in Wonderland on 04.04.13 at 10:06 pm

#58 Smoking Man

I think you can see some aspects of the big picture (when sober…). I bet you don’t watch TV and maybe drink only filtered/distilled water…

#62 Triniboy on 04.04.13 at 10:06 pm

Hey Garth,

Where can I get more info on these “special class of shares” and do some snapping up of my own when they become available?

#63 Smoking Man on 04.04.13 at 10:08 pm

50 Nostradamus Le Mad Vlad on 04.04.13 at 9:46 pm

Hum I’m censing bs…After all I’m the best in that dept.

Realy Hope all is good.

[email protected]

#64 Alga3 Fan on 04.04.13 at 10:08 pm

#184 Smoking Man on 04.04.13 at 7:48 pm

You might be right – I just might be dyslexic. Or psychic, or both?

#65 Most Interesting Man In the World on 04.04.13 at 10:11 pm

#39 kevin on 04.04.13 at 9:22 pm
(my comment from yesterday)

Garth, Do you have any comments on bitcoin?

Why would I? — Garth

~

Looks like you do in fact have a few things to say about bitcoin after all! ;)

+++++++++++++++++++++++++++++++++++++

I don’t often use unicorn farts for currency, but when I do, I use Bitcoin.

#66 Margorie on 04.04.13 at 10:12 pm

I have seen the worst. Here’s what I can tell anyone here in Vancouver. If you believe bungalows are worth 1 million dollars, then you ought to be buying them. If you are not buying any bungalows anywhere in Vancouver for 1 million there will be a serious crash in home values very soon. Perhaps as early as summer as crazies start to list their homes on the way down the toilet!!!!!!!!!!!!! There is nothing in Scamcouver except garbage, that whole city is destined to fail.

#67 MarcFromOttawa on 04.04.13 at 10:12 pm

Garth,

Eric Sprott is my hero.

Regards,

#68 Fabrega on 04.04.13 at 10:15 pm

Print print print now Japan’s onboard, all this will do is continue to devalue the dollar and usher in more inflation and then hyper inflation. The problem with gold and silver is the Fed(privately) owned is controlling the markets. It’s the golden rule. He who has the gold rules. This will not end well when the smoke clears.

Gold down 18 per cent. Some rule. — Garth

Gold went down to raise cash due to stock losses.

Are you a comedian? — Garth

#69 HAWK on 04.04.13 at 10:15 pm

#51 Alyce in Wonderland on 04.04.13 at 9:47 pm

I also wonder about the anomaly of the commodity prices. Gold / Silver I can still understand, as they can be manipulated more easily, but why oil has not gone up much higher, seems strange. When it does I’ll be happy I own a hybrid and also am close to the subway.

#70 Richard and Zeus on 04.04.13 at 10:16 pm

#57 Yuus bin Haad on 04.04.13 at 9:56 pm
I’m going to try burying my cash in the backyard again – I’m hoping the new plastic bills fare better than the old linen ones.

That’s pretty good advice now that it’s plastic.

Didn’t I ban you? Go away, ammo boy. — Garth

#71 Fabrega on 04.04.13 at 10:18 pm

You trust too much the politicians, Garth.

The meaning of “Liabilities” can be twisted to the benefit of anyone.

Give it up. This is old. — Garth

#72 Tom Vu on 04.04.13 at 10:19 pm

Smoking Old Man:

Garth’s camera knows no bounds:

Very glad you use publick transit, many green brownie points await you.

#73 Dr. Oblivious on 04.04.13 at 10:20 pm

Hey Garth, Mansbridge is going to reprise his gangnam style dance, he just needs a partner this time. He wants to know if you are in.

I choose Amanda. — Garth

#74 88,000 of us - 100k+ salaries on 04.04.13 at 10:21 pm

AWESOME!!!

http://www.fin.gov.on.ca/en/publications/salarydisclosure/pssd/

#75 AK on 04.04.13 at 10:29 pm

#54 Alyce in Wonderland on 04.04.13 at 9:51 pm
“By the way the people are laughing at the gold bugs the same way they were laughing at Peter Schiff and Garth when they spoke on the housing bubble years ago.

Have you analyzed the gold bugs view point and the data supporting it?”
——————————————————————–
No. The have been saying that Gold is going to hit $10,000.00 since 1980.

Had I listen to them, I would have been broke.
I have been following the Warren Buffett model all along.

#76 Smoking Man on 04.04.13 at 10:32 pm

#65 Alga3 Fan on 04.04.13 at 10:08 pm
#184 Smoking Man on 04.04.13 at 7:48 pm

You might be right – I just might be dyslexic. Or psychic, or both?

…………………………………

Make this right bro…..Algo3 it’s the way it should have been…..

#77 takla1 on 04.04.13 at 10:35 pm

garth:gold down 18%…….geez garth can you cut the precious metals some slack???note …if you had bought gold in april 9{700.00 oz} and sold last yr at the peak{1900.00 per oz} you would have reaped close to 300% on the investment.I think most are aware that the establishment are very fearfull that if gold runs hard here that it will be an alternative to the u.s dollar for investors.they cant have that so they manipulate the price.talk about fear!I say if its buryed in the back yard it safe from the bankers dyodd

Nobody’s afraid of gold. It’s just a bad investment. Like GICs, but without the fabulous returns. — Garth

#78 Bob the Imp. on 04.04.13 at 10:36 pm

I disagree with your BitCoin comment. If they were likely not going anywhere, we wouldn’t have people creating BitCoin Rigs, ATMs, online company’s using them, and the market rallying their value up. If it was also nothing, the CIA wouldn’t have called the head BitCoin programmer into their Langley office. BitCoin is like Western Union or the Hawala networks, and a commodity in one, with no central ownership or control. You should stick with the Canadian Economy and Real Estate market, topics you intimately understand.

As opposed to play money? (But I love the little CIA story. Makes it so real.) — Garth

#79 bill on 04.04.13 at 10:41 pm

anyone have an idea how to short bit coin?

#80 Smoking Man on 04.04.13 at 10:41 pm

#76 AK on 04.04.13 at 10:29 pm

Followng the camel toe is even better. Bat man is faster though………………

Peeking at my P & L oooo yaaaaaaa

#81 JSS on 04.04.13 at 10:45 pm

Hey Garth – Do you still recommend investing in common shares in the Big 6 banks if you plan on holidng for a long long time?

I never did. — Garth

#82 Nick on 04.04.13 at 10:49 pm

“I think gold is a great thing to sew into your garments if you’re a Jewish family in Vienna in 1939, but I think civilized people don’t buy gold. They invest in productive businesses.”

– Charlie Munger

#83 kreditanstalt on 04.04.13 at 10:54 pm

Is fear and mistrust EVER a correct response?

You should be glad the occupy movement was, as you put it, BOTCHED.

Had it gained some momentum and forced heads to roll, governments to resign or policies to change the manipulation of interest rates, the cheap money, the central bank and government ‘put’ – as well as the trust in bonds and income-earners – would be gone.

The stay-the-course faith in the authorities, governments, central banks – and in earning more and more dollars – that you are constantly touting depends on those authorities not losing control of interest rates.

It’s that close. Panicking early might yet be correct.

#84 Bo Xilai on 04.04.13 at 11:00 pm

Garth, we need your help…

Buzzbuzzhome is doing a similar survey to the one you won in Toronto… This one for Vancouver. Who is the most credible opinion on Vancouver Real Estate? Sorry Garth, you weren’t nominated. Village Whisperer is leading and I’d love to see her go over the top.

Please vote for Village Whisperer… Another excellent real estate blog.

http://blog.buzzbuzzhome.com/2013/04/most-trustworthy-expert-vancouve-real-estate-market.html

Saddle up people. We’re voting. — Garth

#85 Tom Vu on 04.04.13 at 11:01 pm

#81 Smoking Man on 04.04.13 at 10:41 pm

#76 AK on 04.04.13 at 10:29 pm

Followng the camel toe is even better. Bat man is faster though………………

Peeking at my P & L oooo yaaaaaaa

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

Smoking Man have Batman fixation.

I have autographed Wonder Woman/Cat Woman poster and phone numbers .

Thus, the question is posed:

W-H-O would give better advice?

#86 Doom on 04.04.13 at 11:02 pm

Fear

Fear… Fear attracts the fearful… the strong… the weak… the innocent… the corrupt. Fear. Fear is my ally.

Darth Maul – Realtor

http://www.youtube.com/watch?v=vZE1UM6xpjM

#87 Algos Fan on 04.04.13 at 11:05 pm

#77 Smoking Man on 04.04.13 at 10:32 pm

Lol, I agree that my random character generator name is getting old. I prefer Algos – makes me sound like I should be on Game of Thrones or something.

Cheers,
Algos Fan

#88 Bob the Imp. on 04.04.13 at 11:07 pm

Okay Garth and Fiat currency isn’t play money for the Government and IMF. I guess you didn’t see the theatrical about France in 1789 or Japan in 2001 (maybe even 2013). You sorta killed your own point there bro – if it was even a point.

I know it must hurt the mouse hand, but a little research into BitCoin wouldn’t hurt you. And read beyond what Bloomberg, Business Insider, and Fluffington Post have to say (or at least beyond what their Advertisers want you to believe) .

… the truth is out there, it’s all around you.

My research is fine (as opposed to your civility). I sure hope you didn’t buy too many. — Garth

#89 GG on 04.04.13 at 11:14 pm

Bank of Japan – printing 2x current yen in circulation. Ya … I know. … It won’t happen here.

#90 Jounce on 04.04.13 at 11:17 pm

On global cross contaminated and systemic risk, I think Garth has been swilling the cool aid for far too long. I do admire his enduring optimist bent however.

At some future point, when banks in Canada do stagger from a global contagion probably starting in Japan, they will … like all other ‘too big to fail leviathans’ will take as much available/unencumbered deposits … which legally are loans to the banks anyway from you the saver/depositor.

So, despite the repeated promises of Canada’s increasingly frail and untested deposit insurance scheme. which when truly needed will prove to be just another ponzi scheme. Like Cyprus, Zimbabwe, Germany (Pre- 1930’s) the rules for savers will again change to their profound detriment.

We are in a time where there is no interest paid on savings. a daily purchasing power loss due to inflation, higher fees, taxes, levies and other chronic financial assaults.

Given the outsized multi trillion and very lethal derivatives game the big financial boys play we will find that when they have pissed away their capital base, your capital will be forfeited. Froce majure, act of God, tuff luck buck.

All prior promises not-withstanding.

It is time to start shopping for mattresses with extra thick padding to hide your rotting cash.

#91 Daniel on 04.04.13 at 11:19 pm

#14 & #16

$820 in maintenance fees … is this a normal thing in Canada now?

I have a 1000sqft condo in Penang, Malaysia and we pay about $75 per month in maintenance. We have 24 hour security, pool, weight room, sauna, etc.

Malaysia is pretty developed; GDP/capita about half of Canada (15k vs. 30k).

Can’t believe people are paying that much per month in maintenance to live in a box, it’s more than my mortgage, condo fees and utilities – and my condo is worth about the same … $250k (RM750k).

#92 Bob the Imp. on 04.04.13 at 11:23 pm

Dear Garth, I apologize for my civility. Your first point however was taken to be a little condescending.

P.S. I actually used a $1K BitCoin Rig last year and made $11.5k with the market rally on Wednesday, traded it for that ‘play money’.

#93 Spiltbongwater on 04.04.13 at 11:26 pm

#85 Bo Xilai on 04.04.13 at 11:00 pm

I went to that site to vote for Ozzie Jurock, but he was not a candidate, so voted Village Whisperer.

#94 Bob on 04.04.13 at 11:33 pm

Japan’s Debt Crisis Visualized (and the US and UK and Europe and every other jurisdictions economy presently being propped by QE)
http://www.youtube.com/watch?feature=player_embedded&v=Njp8bKpi-vg

#95 Forward your fake news story on 04.04.13 at 11:34 pm

#21 you should alert http://whispersfromtheedgeoftherainforest.blogspot.ca/about this, he will bring this into the open!

#96 AprilNewwest on 04.04.13 at 11:36 pm

#21 – It’s no longer there.

#97 VancouverTrailerTrash on 04.04.13 at 11:37 pm

Prediction: Mobile Home parks will be the wave of the future in Canada.

Example: You can live in West Vancouver, across from Stanley Park, in a 3 bedroom mobile home for $600/month. The mobile home can cost between $60,000-$120,000.

Great surroundings, tons of facilities, walk to the beach or to the mall, and one of your CPP cheques covers your rent every month.

Hell of a deal.

#98 QQ on 04.04.13 at 11:40 pm

Garth, how r u so sure that Canadian banks will never fail? a few yrs back everyone said the same thing about US banks, many of whom AAA.

yet, Lehman popped, WaMu dropped, AIG became a basket case and Citi was insolvent.

if the US recovery goes sour, the Canadian econ will stall. real estate is already on decline which will only accelerate. Canadians are already too heavy in debt. banks will quickly find themselves loaded with bad loans. the Fed and BoC are no longer in position to reduce interest rate further (by meaning measure).

now for the real kicker…. what if the next time they dish out stimulus, the interest rate goes straight up?

#99 Dr. WAYNE on 04.04.13 at 11:41 pm

#74 Dr. Oblivious on 04.04.13 at 10:20 pm

Hey Garth, Mansbridge is going to reprise his gangnam style dance, he just needs a partner this time. He wants to know if you are in.

I choose Amanda. — Garth

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

Of course you choose Amanda … with the massive dose of filler in her lips … not?

#100 Dries on 04.04.13 at 11:44 pm

Why did Cyprus not opt for this solution? Instead depositor haircuts….

#101 Mick on 04.04.13 at 11:46 pm

Garth, are you aware of the fact that Canadian debt is re-hypothecated via the London banking establishment? I’m guessing not. Whatever you think our debt stands as, multiply it bi 10-20X. That’s what insiders know and is why the govt included that section about banks into the budget.
Nothing is what it seems right now, we should know better than to believe governments and MSM.

#102 Small Town Steve on 04.04.13 at 11:59 pm

Lol I voted for the dog, he looked to be the most credible of the lot.

#103 John on 04.05.13 at 12:11 am

How can we explain house prices in Edmonton now approaching their highest levels ever (2007 levels)? Sales are down about 6% when comparing March 2013 to March 2012. Single family detached homes are up 7% in the same time period. Reading this blog would lead most readers to believe that prices are going to drop in every city across the country. Could Garth be wrong on Edmonton? Over the past year, we keep hearing on this blog (and many other “experts”) about how prices are definitely going to drop, but it never seems to happen. It would be nice if Garth could attach a probability to his prediction that average prices in all Canadian cities will drop in the next 1-2 years. Is he 99% confident? 75%?

#104 John on 04.05.13 at 12:12 am

Here is an article I mean to post on my comment #98 about Edmonton prices now near record highs:

http://www.edmontonjournal.com/business/City+home+prices+flirt+with+record+highs+2007/8191062/story.html

#105 charles on 04.05.13 at 12:15 am

Your casting doubt on Mr. Sprott’s credibility is a true testament to your view of the world.

#106 Saskiboy on 04.05.13 at 12:17 am

Hitler blamed the german people for the loss of the war. Harper and F will blame the canadian consumer for ruining the economy. Rats breed in the depths and shadows only to surface when cold waters flood in. Or a easy morsel presents itself. Invest in steel. Physically, emotionally, spiritually. I do. Summers in stoon are always dangerous times. The rats. They have knives. Yes. A poet lives here.

#107 Soylent Green is People on 04.05.13 at 12:22 am

Who Killed Canada
Media Ownership and the Radical Right in Canada

http://www.youtube.com/watch?v=d8D67YiLcOM
http://www.youtube.com/watch?v=fiurWhmOIgk&feature=related
http://www.youtube.com/watch?v=iRnZ43wxGvY&NR=1
Part 1, 2 & 3. Note: each video about 10 minutes long

No time for video? Read review instead:
http://pushedleft.blogspot.com/2009/11/under-stephen-harper-we-are-no-longer.html

Mr. Hurtig begins by discussing the Canadian media and how we now have the greatest concentration of media in the western world. In fact, he states this would simply not be allowed in any other western democracy.

And since these same media outlets control newspaper, television and radio news; we are essentially only being given one voice. There are few or no alternative views. As stated in the video, a healthy democracy should foster a healthy and independent news media.

http://pushedleft.blogspot.com/2009/11/under-stephen-harper-we-are-no-longer.html

O
O
O
O

#108 White Rock Mom on 04.05.13 at 12:24 am

Patiently Waiting
I saw your numbers from the Fraser Valley and White Rock. WOW!!! The numbers speak for themselves.
I noticed from one of your listing lists that most sales are $100,000 belw asking. One house on Canterbury sold for $270,000 less than the original asking price.
Mom

#109 Saskiboy on 04.05.13 at 12:40 am

Do not bet against the US or Japan. Cowboys and Samurais. Steel eyes that fly with viruses digitized. Cherry blossoms in spring. A warm cup of green tea. A neighbors dog barking incessantly. Amanda Lang is a digital representation. Total cgi. She has got to be.

#110 KommyKim on 04.05.13 at 12:41 am

RE: #82 JSS on 04.04.13 at 10:45 pm
Hey Garth – Do you still recommend investing in common shares in the Big 6 banks if you plan on holidng for a long long time?

He mentioned that BNS preferred shares were “on sale” a while ago. I think that ship has sailed.

RE: #70 HAWK on 04.04.13 at 10:15 pm
but why oil has not gone up much higher, seems strange.

Yea I wonder what the frack is happening. ;-)

#111 Dean Mason on 04.05.13 at 12:45 am

To Vancouverite #46 I see they changed it in 2008. It used to be $100,000 like here in Ontario. Ontario did put unlimited DICO deposit insurance on credit union deposits TFSA’s,RRSP’s,RRIF’s,RESP’s but not on non-registered accounts. You can still have $100,000 joint account, $100,000 per single, $100,000 Trust account so a total of $400,000 at least for a couple with one son or daughter.

I personally would not feel comfortable having all or most of my deposits in one credit union even though they say it is unlimited deposit insured .It just does not feel right to put all your money in one thing or place.

Also, I’m not saying this will happen but what if B.C or any other province reduces or changes the law because it’s too much risk in one credit union. I never heard this happening but there are financial surprises since 2008 both good but mostly bad. People have to be very careful.

#112 Jake on 04.05.13 at 12:51 am

#92
That’s upper range but not abnormal. It does include all utilities too.

#113 John Prine on 04.05.13 at 12:53 am

Dean Mason on 04.04.13 at 9:19 pm
There is a reason why CDIC has a $100,000 maximum insured deposit limit for banks,trust companies etc. DICO also has a $100,000 maximum insured deposit limit for credit unions as well as other provinces have their own maximum deposit limits for credit unions.
********************************************

Probably already been said but 100% of Credit Union deposits (in BC anyway) are covered. No wonder 50% of British Columbians choose to use them. Ours does profit sharing as well. We received $1,070 cash back last year, not like the big banks at all.

#114 earlybird on 04.05.13 at 12:57 am

“Caveat Depositor”….very catchy! Fine post today and some great comments.

#115 Oakvillian on 04.05.13 at 1:01 am

garth you are wrong again. says susan pigg

http://www.thestar.com/business/real_estate/2013/04/04/canadian_housing_market_in_a_highly_unusual_place.html

She repeats a Royal LePage press release. You are both gullible. — Garth

#116 Tom Vu on 04.05.13 at 1:02 am

Much posting tonite, almost 3 hors devouers of magnitude

WTF?

Oh yeah

Toronto teams all losers…only Argos don’t have losing record(YET)

#117 lookoutbelow on 04.05.13 at 1:22 am

Garth, it all depends on the depth of the crisis should it occur sometime in the future. So, assume that Housing crashes 50%, hell it’s already down 15%!

First of all, only $100,000 in a given bank is CDIC insured for a single depositor. No more.

So here is the question: Are Depositor’s funds above $100,000 in a given bank safe? The answer is clearly NO. Just like Cyprus!

It was also interesting that Mr. Flaherty himself did not issue this clarification and take questions from the press. I believe the “clarification” was handled poorly by his press secretary.

So, it all depends how bad it gets for the Banks. Be cautious if you have more than $100,000 in any given bank!

#118 observer on 04.05.13 at 1:37 am

That funny, because if the banks failed you wished you’ll own a house. But if you have a hefty Mortgage, guess where rates are going to go because no idiot would want to buy Canadian bonds or treasuries at a measley 2%

The risk of the banks robbing that is too high so just like the 80’s expect to see interest rates soar. And the banks milking the SH!T out of the poor fools which are heavily in debt.

As I can recall I bought a Sierra Truck at an auction for 250 Bucks and tons of cheap stuff because no one had any money.

Just note having a house doesn’t feed the children. Trying to sell it for food means nothing. I got some Bit com and also some gold but who knows what will happen just keep diversified and cover all angles.

#119 Joe Calgary on 04.05.13 at 1:49 am

But running out of it

#120 drydock on 04.05.13 at 2:12 am

I can’t stand it any more. It’s losing , not loosing.
Losing, losing, losing, losing, losing.
Not fcuking LOOSING.
If you don’t believe me look it up in a dictionary.

#121 Joe on 04.05.13 at 3:27 am

Looks like Bank of Japan’s having a wee meltdown.

#122 Onthesidelines on 04.05.13 at 4:43 am

It’s not different in Canada. Not in housing bubbles nor in potential bank failures nor in governments anywhere doing whatever they want regardless of what promises or assurances are made.

The proof is overwhelming, and it is naive to think otherwise.

#123 Ballingsford on 04.05.13 at 4:55 am

As I’m starting to get more knowledgeable about investing I have a MER question. Example: I have $10, 000 in an investment instrument. Last year the MER was 1.6%. Return on investment lasy year ending Dec 31st was 7%. MER comes out first so bank pockets $160. I make $700.00. So now I have $10, 700 in that vehicle.
Is my figuring correct? The bank or whoever doesn’t get any more.

#124 Ballingsford on 04.05.13 at 5:20 am

#37 mr oblivious

Go get yourself a galaxy 3 or wait for the 4. Much more portable. I had to buy a laptop a few weeks ago so I could file my taxes because, but that was about the only reason I needed it. They don’t have an android app yet that the gov’t will accept for filing your taxes.

#125 Ralph Cramdown Ⓤ on 04.05.13 at 5:58 am

#84 kreditanstalt

I just love that you’re so out of touch that you think the Occupy movement might be in favour of higher interest rates.

#126 GeorgeSoonToBeRetired on 04.05.13 at 6:50 am

How much of the US rebound is based on this kind of thing?

http://www.reuters.com/article/2013/04/03/us-usa-qe3-subprimeauto-special-report-idUSBRE9320ES20130403

From this fairly detailed article:

Critics of the Fed say the growth in subprime auto lending is just one of several mini-bubbles the bond-buying program has created across a range of assets – junk bonds, subprime mortgage securities, and others. The yield chase delivered big windfalls to some Wall Street firms and hedge funds holding securities that soared in value. But so much money has flowed into these assets, the critics say, that the markets for some are beginning to resemble the housing boom in the run up to the financial crisis.

“It’s the same sort of thing we saw in 2007,” said William White, a former economist at the Bank for International Settlements. “People get driven to do riskier and riskier things.”

Yes, buy an F-150 for your small business. Very risky behaviour. — Garth

#127 JustTryingToProtectEquity on 04.05.13 at 7:01 am

#120 Drydock

It is definitely losing.

Not definately loosing.

Agreed.

#128 neo on 04.05.13 at 7:16 am

Garth should never have used the Nikkei’s orgasmic rise to support his argument. In hindsight, it will actually demonstrate the sham the equities markets have become due to price controls. In Japan’s case theirs hasn’t worked for the last 20 years. And the doubling down they have recently done has only produced a blow off top that will be produce a nasty crash. Every major economic metric you want to use to try to support their equity market is negative so this has zero to so with the fundamentals or corporate profits, but is all about the intervention of the BOJ. Which in the end will be their downfall (again). However, in Garth’s zeal to be right he couldn’t help himself and had to throw them in the mix to support an argument Japan flies in the face of. Next time vet your indices better (-;

Weasel comment. I included a basket of indices to prove a point: investors in growth assets have done extremely well. Those who know how to rebalance will capture and enjoy their gains. Guess that did not include you. — Garth

#129 Ralph Cramdown Ⓤ on 04.05.13 at 7:18 am

#106 charles — “Your casting doubt on Mr. Sprott’s credibility is a true testament to your view of the world.”

Mr. Sprott’s credibility is on public display for all to see. Most of his funds are money losers, as is the stock of his management company. He bets according to his convictions and he loses. Hell, even his Sprott Strategic Fixed Income Fund is a money loser, and it’s a rare talent indeed who’s figured out how to lose money in a bond fund over the last two years.

https://www.google.ca/finance?q=sprott

It’s worth pointing out that credibility and credit originate in the same latin root. If you let Eric Sprott invest your assets for you, are you likely to get them all back? No, you are not. He’s a BAD CREDIT.

#130 Tony Right on 04.05.13 at 7:22 am

Don’t worry sheeple, CNN will manufacture a new fear that will have no affect on your life, but you”ll treat as the end of the world, by Monday. I’d like to gobble up some of those contingency bonds…sweet yield I’m sure!

#131 Bigrider on 04.05.13 at 7:38 am

http://www.thestar.com/business/real_estate/2013/03/29/firsttime_buyers_find_toronto_real_estate_market_hot_as_ever.html

An article in complete contradiction to what Garth is saying about Toronto housing

#132 EIT on 04.05.13 at 7:44 am

CYPRUS = CENTRAL BANKS SHOW THEY WILL NOT PRINT MONEY FOREVER. Remember complaining about endless money printing? Well now you can cheer on the troika.

#133 The Man From Nantucket on 04.05.13 at 7:49 am

US Recovery and Auto Sales:

http://ca.finance.yahoo.com/news/special-report-fed-fueled-explosion-subprime-auto-loans-110501752.html

“……..To make up for the risk of taking on increasing numbers of high-risk borrowers, subprime auto lenders charge annual interest rates that can top 20 percent……..

These abominations are reportedly being wrapped up into high yield securities just like the toxic mortgages.

I know it’s still sales, and that sales are good, but my gut says that there are lots of yanks who just can’t wait any longer for a new ride, but they’re still broke……..

Wonder how long Dow and S&P500 can keep racing with this underneath it.

#134 Stickler on 04.05.13 at 7:55 am

“Those accounts will continue to remain insured through the Canada Deposit Insurance Corporation, as always.” – Garth

>>>
…right, and amounts over the CDIC limit are not insured as always.

Where is a link showing that deposits over the CDIC limit will never be touched?

Here is the deal (chart below)… if a bank needs $ they start at the bottom (with stock holders) and work their way up (to uninsured deposits).

The new section of the budget aims to make the Government regulatory oversight fast & smooth IF they ever need to get to the depositors:

Depositors
======== <<< Government regulatory barrier
Senior Bondholders
Unsecured Bondholders
Equity (stock) holders

If you say I am wrong, please back it up with actual verifiable facts.

Of course you are wrong. Banks do not own deposits. This is too stupid. — Garth

#135 Butch on 04.05.13 at 8:18 am

This place was on the market for 6+ months last year… for 900k+ (can anyone pull the real number?)

http://www.realtor.ca/propertyDetails.aspx?propertyId=13007621&PidKey=1915466427

Looks like they’ve come down a little.

#136 Herb on 04.05.13 at 8:18 am

“When the changes were first announced, those who were actively shopping had to re-evaluate how much home they could afford to finance.

– Tim Lee, President of the Ottawa Real Estate Board, at
http://www.ottawacitizen.com/homes/Ottawa+home+sales+keep+falling+prices+stay+firm/8195081/story.html#ixzz2PaeLoGEv

And we thought that house prices were a function of supply and demand, when they actually are determined by mortgage regulations!

#137 T.J. BONES on 04.05.13 at 8:19 am

Sir Garth: Only one Liberal senator’s husband was exposed of the offshore crowd. Who are the other 449 on that list? Me thinks that the MSM controllers don’t want that information out. H and F have everything to hide. PS I’m sure you are not on that list..

#138 DA, why don't you talk about all the foreclosures in Kelowna on 04.05.13 at 8:19 am

Kelowna real estate sales for March just in and they stink!

Year‐to‐date, sales slipped 7.7% compared to January
through March last year.

And that’s using the real estate frankenumbers. I’m sure if they were using legitimate stats the percentage would be much greater.

This is the peak of the spring selling season, watch out Kelowna, even the foreclosures aren’t selling!

#139 tb on 04.05.13 at 8:24 am

#21 MSM Observer

Thanks for posting, much appreciated.

Funny how they changed “diminué de 0,4%” to “progression de 0,4%”. I wonder whether they figure they can play with words and talk about a “downwards progression”, even though that’s obviously not what people think when they read the word “progression”.

#140 Stickler on 04.05.13 at 8:29 am

“Of course you are wrong. Banks do not own deposits. This is too stupid. — Garth”

>> Your statement is not accurate.

…When someone opens a bank account and makes a deposit, the account holder surrenders legal title to the cash. This cash becomes an asset of the bank.

Example: A depositor opening a checking account at a bank with $100 in cash surrenders legal title to the $100 in cash, which becomes an asset of the bank.

On the bank’s books, the bank debits its currency and coin on hand account for the $100 in cash, and credits a liability account (called a demand deposit account, checking account, etc.) for an equal amount.

Bank assets are loans. Liabilities are deposits. Nobody surrenders legal possession of a deposit. — Garth

#141 Ray on 04.05.13 at 8:40 am

#137, according to guava.ca
W2453939 – M9A – 80 AVONHURST RD Toronto, Ontario – $919,000

Price Change. Oct 12: $919,000 Sep 6: $969,900
Islington Village At Its Very Best!This Home & Garden Classic Is Full Of All Your Wants & Needs.An Ezquisitely Unique Designed Interior Not To Mention The …

#142 Pr on 04.05.13 at 8:52 am

August 15, 1971: A Date Which Has Lived In Infamy.

http://4.bp.blogspot.com/-fSulio7oFgM/UV3Pu5Xts0I/AAAAAAAAF8A/UaeVRW6PEKU/s1600/Average+Annual+Canadian+House+Price+1956+-+2012.jpg

My spelling and punctuation are not that good, but i am learning.

#143 neo on 04.05.13 at 8:54 am

Weasel comment. I included a basket of indices to prove a point: investors in growth assets have done extremely well. Those who know how to rebalance will capture and enjoy their gains. Guess that did not include you. — Garth

That basket included a basket case of a country that led the returns in said basket. Nothing “weasel” about it. Look at a one year chart of the Nikkei and tell me if that countries 2012 recessionary GDP and export numbers support their index. It has gone hyperbolic for heavens sake. By the way, back in North America. Realllllly strong job growth this March. That recovery is rather robust isn’t it. Oooops.

#144 CP on 04.05.13 at 9:04 am

Thanks Garth, I appreciate your post today.

#145 DA, why don't you talk about all the foreclosures in Kelowna on 04.05.13 at 9:15 am

Here’s an example of just how bad it is in Kelowna.

This place was originally priced at $4 million dollars, languished on the foreclosure listings for over 3 years, finally sold for $1.6 – and that probably was too much.

That’s a $2.4 million dollar price drop!

http://matrix.omrebmls.ca/Matrix/Public/Portal.aspx?L=1&k=34787XNM88&p=AE-2785-50&n=1

If you’re selling your house in Kelowna you better be thinking of dropping your price and quickly because its only going down from here!

#146 DA, why don't you talk about all the foreclosures in Kelowna on 04.05.13 at 9:17 am

The address for the post above is:

#1701 1947 Underhill, Kelowna, V1X 7Z5

#147 pbrasseur on 04.05.13 at 9:21 am

Canada is shedding jobs at near unprecedented rate.

This is no fluke, no wonder the TSX was tanking.

Yesterday I was wondering why the $CAN was rising. The question is now irrelevant…

The TSX is down 0.5% at noon on Friday. Is that ‘tanking’ where you live? — Garth

#148 Ray on 04.05.13 at 9:21 am

#132 Bigrider on 04.05.13 at 7:38 am
For sure it is written by Susan Pigg.

#149 Toronto_CA on 04.05.13 at 9:24 am

http://www.thestar.com/business/2013/04/05/canadas_economy_unexpectedly_loses_55000_jobs_in_march.html

Ouch. That smarts.

#150 Smoking Man on 04.05.13 at 9:24 am

BOOM!!!! 5 YEAR bench mark yield 1.19

Banks fighting for business, time to vulch…. 2.4 five year mortgage s

#151 -=jwk=- on 04.05.13 at 9:41 am

I am seeing the slow down on the ground in my ‘desirable’ area of toronto (note: all areas of Toronto are desirable per realtors) . There is a semi backsplit that had three back to back open house weekends. We went when there was 2ft of snow on the ground and price was $499k, offers on Tuesday at 7pm. Dropped to 479. now 7 weeks later at 465. The bung around the corner (nicely renovated, not over the top, practical and very well finished.) for 550k is off the market unsold. Loved the bung, but won’t buy anything smaller than our leased side split now.

This is the same hood we used to cruise last summer. back then about half theopen houses were cancelled as it was sold already or held to collect potential buyers who were told it was sold already. Our poor relator was checking listings every 2-4 hours to give us a chance….what a difference! I would go 329 on the backsplit, tops.

#152 The Prophet Elijah on 04.05.13 at 9:41 am

Jobs report from US worst since Dec 2009:

http://www.zerohedge.com/news/2013-04-05/payrolls-plunge-88k-biggest-miss-december-2009-participation-rate-new-30-year-low

Canada sucked too, biggest job losses since 2009:

http://www.bloomberg.com/news/2013-04-05/canada-records-biggest-job-losses-since-2009-recession-in-march.html

Garth what does this imply for RE?!? Was I wrong to buy in Calgary, the land of milk and honey?

#153 afraidit allmightend on 04.05.13 at 9:58 am

Garth… don’t be too quick to defend the status quo…..things do change. The current system will evolve….it won’t die. Our current economy is based on the full faith and trust of a balanced democratic system of government ability to manage our finances……that fallacy has been exposed and we see that in reality there is a shift in power to a super elite hybrid of socialism that envisions an alternate reality that is not funded by capitalism.

These absolute ideological visions have a way of changing things absolutley…..resulting in messy divisions and eventually war.

Whatever. I’m more interested in having a prosperous and enjoyable life. It’s the only one I get. — Garth

#154 Stickler on 04.05.13 at 10:04 am

“Bank assets are loans. Liabilities are deposits. Nobody surrenders legal possession of a deposit. — Garth”

Bank assets include loans. All assets that are in possession of a bank or due to the bank are the assets of a bank.

Deposits are considered liabilities, yes.

The bank’s financial statement reflects the economic substance of the transaction—which is that the bank has actually borrowed $100 from its depositor and has contractually obliged itself to repay the customer according to the terms of the demand deposit account agreement.

To offset this deposit liability, the bank now OWNS the actual, physical funds deposited, and the bank shows those funds as an ASSET of the bank.

Deposits are liabilities. Period. Give it up. — Garth

#155 Stickler on 04.05.13 at 10:16 am

…anyway. The point is that IF a bank failed (not saying one will) All deposits could be used to repay creditors if required.

…this includes insured and uninsured deposits.

IF this happened, CDIC (not the bank) will pay you up to the insured amount.

And of course all interested parties develop plans and procedures re how it would all work IF it happened.

#156 Kingarthur on 04.05.13 at 10:16 am

From today’s Globe:

http://www.huffingtonpost.ca/jenna-em/toronto-housing-market-2013_b_2972732.html

Bidding wars persist in the GTA! What gives?

Ar reported here. — Garth

#157 Ralph Cramdown Ⓤ on 04.05.13 at 10:30 am

#142 Stickler — “When someone opens a bank account and makes a deposit, the account holder surrenders legal title to the cash.”

Just the other day while making a deposit, I was going to sign over legal title to my banknotes, but some ‘M Carney’ clown had already signed them all.

Seriously pal, if you’re going to use big boy terms in public, especially under a ‘Stickler’ moniker, it would behoove you to know what they mean.

#158 kreditanstalt on 04.05.13 at 10:33 am

#126 Ralph, I’ve been called “out of touch before”…forgiven.

Read carefully: had the Occupy movement met some success, one of the results would be higher interest rates. Not to say they’d like it…

But it sure would be healthy for us all!

#159 Stoopid Idiot on 04.05.13 at 10:38 am

Hehehehe That guy said Fiat… what a great day yesterday, bought some quality gold shares cheap. Dry powder on hand for all pull backs. Garth… are you turning this into a Gold Blog? This fear fix may be nothing more than a ploy to get people to pull money (or some monies) out and spend… like on a house! Or other over valued consumables.. Just saying since the GDP of this country is derived from such practices. None the less the markets are a confidence game and these loftily levels are orchestrated to give semblance of confidence. I own my Home (not a house) and it only makes up less than ten percent of my net worth. I could qualify and be approved for far nicer… but hey, the best looking house in a ugly neighborhood is the one that’s paid for, so what do I care that the guy next door sell’s for. This Pathetic Blog seem to cater to those near to or are underwater on the existing death contract’s. Yields in Canada and or the G7 countries for that matter are negative and the real inflation numbers are hedonically obscured. I do though Garth agree with your advice to exist stage left with any equity from your home or get rid of a second property if you have one. If people do drink the cool aid and pull cash could this not impact the spread on the fractional reserve side on any Canadian Bank… If so would not these banks require recapitalization, say… thru a bail in? hell everything ells is guaranteed by the government (or should I say Tax Payer) If I could ask.. are any Canadian Banks exposed to the derivative market? When that unsecured debt hits the market… people will run to Gold

http://en.wikipedia.org/wiki/Mortgage_loan

#160 Doug in London on 04.05.13 at 10:41 am

Forget grossly overpriced Bitcoins. There are better deals to be had with stuff that’s on sale now, like Emerging Markets funds, resource and energy funds.

#161 Ralph Cramdown Ⓤ on 04.05.13 at 10:43 am

Hey dawgs, here’s some fun from the mortgage broker community. Thought brokers were working for you? Radius Financial lets brokers “charge higher rates on one deal, earn and “bank” points, and then use those points for rate buy-downs on future deals. (This is admittedly somewhat controversial, since some clients pay higher rates so that other customers benefit, at the broker’s discretion.)”

I’ve been banned from the site for negative attitude, so maybe some of you could head over to canadianmortgagetrends.com and tell them what you think of this idea…

#162 CAN NEVER HAPPEN- HAHA! on 04.05.13 at 10:51 am

the first bank that will probably require the largess of the Canadian government/taxpayer to bail them out is Scotiabank…as their precious metals division, Scotia Mocatta…along with JPMorgan Chase in the U.S.A…are massively short both gold and silver on the COMEX at the moment…and the amount of money it will cost the Bank of Nova Scotia to extricate themselves from this situation will make your eyes glaze over.

#163 Stew on 04.05.13 at 10:53 am

They are tax evaders, not bank avoiders. — Garth

Another disinformation post. MOST pay taxes then hide their money offshore. Perhaps they don’t want to keep it in CANADA! Where did you get that DISINFORMATION AGAIN? Do you think before you POST? Where are the facts?

Like arguing with a curb. — Garth

#164 James on 04.05.13 at 10:56 am

” Instead, banks will likely soon be required to set aside ‘contingent capital’, such as a special class of shares or ‘bail-in bonds’ which pay investors a heightened rate of interest. These could be quickly turned into cash to shore up a staggering bank in the event of a crisis.” – Garth.
==============================
It doesn’t add up.
Okay, banks sells “bail-in bonds” with higher yield due to risk of a hair cut if a bial-in in required.
Banks does what to earn enough to fund the higher yield they are going to pay the BI bond holders?
Buy government paper – not enough yield unless its Greek paper.
Buy other Cdn bank’s BI bonds in a reinsurance type scheme? Maybe.
Most likely they’ll lend it out fractionally – say 10-to-1 like they would with all their regular capital and would not likely be able to convert ot cash during a crisis which defeats the purpose of trying to setup a special contingency fund for a bail-in.

Btw, wasn’t Basel III rules suppose to cover this capital issue?

#165 The American on 04.05.13 at 10:57 am

More good news for the American economy…
http://news.yahoo.com/us-trade-deficit-narrows-43b-123535066.html

#166 rosie "moving backwards" on 04.05.13 at 11:00 am

Let’s see, mortgage free by 57. That gives me 8 years to save for my retirement. Shouldn’t be a problem. I’ll buy a lottery ticket or go to the casino. Now what about that new F 150? http://www.newswire.ca/en/story/1141217/cibc-poll-canadians-don-t-expect-to-be-mortgage-free-until-age-57

#167 DDCorkum on 04.05.13 at 11:01 am

#22 Alyce in Wonderland on 04.04.13 at 8:53 pm

“Never is a very long time. Why would they provision it then if it (the ‘unlikely’ event) would never happen?”

——-

Its called moral hazard. If you create a system where people expect government bailouts, you increase the likelihood that it will have to happen repeatedly.

But if you establish credible mechanisms to force losses onto share and debtholders, then it will make them think twice. They will want to know that their money is safe, and that will force the banks to be more careful. By forcing the banks to be more careful, you ensure that these mechanisms are never actually needed.

Put another way: these mechanisms are largely serving their purpose by not being used.

#168 Joe on 04.05.13 at 11:06 am

US economy hits a speed bump, the house of cards due for a large correction.

#169 Steven Rowlandson on 04.05.13 at 11:10 am

Securities designated as contingency capital. Undoubtedly the bonds. But it will never happen. — Garth

No doubt it will seem like that to you Garth untill it happens. It is called a black swan event.
So Garth do you have your gold and silver pet rock collection just incase?

#170 Stoopid Idiot on 04.05.13 at 11:26 am

Just to be safe it is probably best to not have investments in a bank (stocks or otherwise). Get a questrade account. And with them you can also buy gold and take delivery if needed.

Insane advice. — Garth

OMG… I agree, do you not understand third party liability… did not MF Global teach you anything. Unless you are participating in direct registration you don’t own your shares… as far as gold goes… If you don’t hold it… you don’t own it

http://bulletproofshares.com/

#171 wilbur on 04.05.13 at 11:27 am

What do you think of this article

http://moneytalks.net/state-wrecked-the-corruption-of-capitalism-in-america.html

#172 Freedom 85 on 04.05.13 at 11:31 am

Garth,
you’ve been teaching us not to believe everything the government says because they lie (in our best interests of course). No need to scare the sheeple….Now we’re supposed to believe what they tell us.
Just follow the trends and the trends are clear, government will do whatever government needs to do to maintain itself. If your deposits and mine are something they need, they’ll take them.

Of course they won’t. — Garth

#173 Holy Crap Wheres The Tylenol on 04.05.13 at 11:32 am

Hum,
This is reminiscent of 1929 where the failure set off a worldwide run on US gold deposits (the dollar), and forced the Federal Reserve to raise interest rates into the slump. Some 4,000 banks and other lenders ultimately failed. Also, the up tick rule, which allowed short selling only when the last tick in a stock’s price was positive, was implemented after the 1929 market crash to prevent short sellers from driving the price of a stock down in a bear raid.

Going to Walmart to purchase my rifle.

I see no comparisons. — Garth

#174 TS on 04.05.13 at 11:42 am

Think about it, where do you put your money? bank? stock/ETF/fund? property? glod?

Don’t think too big, don’t dream to win big, in order to starting your winning the first thing is don’t lose or don’t lose too much.
So, which one is more scure? just a bit more scure. the answer is not that difficult.

#175 raider on 04.05.13 at 11:57 am

Garth, this is the second time you mention that they’ll likely issue unsecured debt to boost their capital reserves as required.

Where would you invest in those things. Are these issues going to be exchange listed somewhere (like some preferreds)?

Google was not really helpful to figure this out, as
unsecured debt is a very generic concept.

Thanks

Debentures are unsecured bonds. Robust secondary market. — Garth

#176 Richard in Kelowna on 04.05.13 at 12:10 pm

TSX flirting with the 200DMA this morning. Let’s hope it holds…otherwise could get pretty ugly….Weak, unexpected US and Canadian job numbers just one of the reasons for stock markets to take a breather…

A correction would be welcome. — Garth

#177 bad news on 04.05.13 at 12:12 pm

IMHO rising unemployment in Canada is the only ingredient missing for a serious RE crash

http://www.ctvnews.ca/business/canada-loses-54-500-jobs-in-march-unemployment-rises-to-7-2-per-cent-1.1225328

interesting times ahead

#178 jess on 04.05.13 at 12:15 pm

ireland restoring consumer confidence in construction

Developers face two years’ jail for shoddy buildings
http://www.independent.ie/irish-news/developers-face-two-years-jail-for-shoddy-buildings-29175549.html

#179 Old Man on 04.05.13 at 12:21 pm

Mr. Turner has great insight into photos with a hidden meaning, and this one will not interpret, but I see the DQ. I would rather do a detailed interpretation with Spendour In The Grass by Wordsworth, as the other day brought back old memories for me.

#180 jess on 04.05.13 at 12:22 pm

http://www.independent.ie/business/technology/cyber-attack-on-bitcoin-exchange-exposes-flaws-in-virtual-currency-29175639.html

#181 Godth on 04.05.13 at 12:27 pm

Whatever. I’m more interested in having a prosperous and enjoyable life. It’s the only one I get. — Garth

As another of your boomer generation once told me “it’s a lot more fun to make a mess than to have to be the one to clean it up” followed by big laughter.
The fat lady is still warming up.

#182 Tony on 04.05.13 at 12:31 pm

Re: #178 Richard in Kelowna on 04.05.13 at 12:10 pm

At least Canada told the truth about March employment. America probably had 88 thousand job loses but reported 88 thousand gains just like they’ve been lying every month with America still in recession.

#183 Stoopid Idiot on 04.05.13 at 12:31 pm

anyone have an idea how to short bit coin?

Yes Bill…. Just own cash

#91 Jounce
It is time to start shopping for mattresses with extra thick padding to hide your rotting cash.

http://globaleconomicanalysis.blogspot.com/2013/03/spanish-firm-markets-mattress-with.html

Did my part for the Village Whisper Garth… She has a great smile

#121 drydock

How do you feel about Stoopid?

#126 Ralph Cramdown

I just love that you’re so out of touch that you think the Occupy movement might be in favour of higher interest rates

There is no way in the world Ralph that you could pass a piss test (employment prerequisite)

Like arguing with a curb. — Garth

Good one…. I’ve lost a few argument’s with curb’s… I think S.M. may have too

#184 Loopback on 04.05.13 at 12:43 pm

Unregulated short sellers (fraudsters) driving the paper price of commodities down in a bear raid. Bingo!

#185 Stoopid Idiot on 04.05.13 at 12:44 pm

seems to be in line with today’s vein:

http://www.youtube.com/watch?feature=player_embedded&v=thPpJSkNvPo#!

#186 Tony on 04.05.13 at 12:49 pm

Re: #161 Stoopid Idiot on 04.05.13 at 10:38 am

If you remember the day the stock market crashed back in ’87 the gold shares where up strong early in the morning only to lose thirty percent (yes thirty percent) at the end of that day Monday. The stock market is looking at a repeat of ’87 but the aftermath will be down in the future not up.

#187 Richard in Kelowna on 04.05.13 at 12:52 pm

“TSX flirting with the 200DMA this morning. Let’s hope it holds…otherwise could get pretty ugly….Weak, unexpected US and Canadian job numbers just one of the reasons for stock markets to take a breather…

A correction would be welcome. — Garth”
……………………………………………………………………

You may be right Garth with this just a much needed correction but it always troubles me when the so called informed and smart money are virtually all of the same opinion, and they get it wrong and which happens too often…witness the jobs reports out today…

Weak reports were expected. That’s why the markets are down marginally. — Garth

#188 Humpty Dumpty on 04.05.13 at 1:07 pm

Yen Selling May Become an ‘Avalanche,’ Soros Says

http://www.cnbc.com/id/100618076

In this interview, Co-founder George Soros speaks at the Institute for New Economic Thinking’s “Changing of the Guard?” conference in Hong Kong on what he sees as the most urgent issues in the global economy.

http://www.youtube.com/watch?v=_Wwja1QQuWE&feature=player_embedded

#189 zeeman1 on 04.05.13 at 1:08 pm

Garth, your thoughts on introducing private competing currency into the money supply?

Visa or Amex dollars, for instance?

#190 Soylent Green is People on 04.05.13 at 1:16 pm

Nice pic of the Queen… speaking of Queens….

……………….

But Harper’s choice of reading material has disturbed even some of his own party members.

The senior Tory recounted being told Harper had “read and mastered” the biography and leadership style of Russia’s Communist dictator Josef Stalin, and said the prime minister has adopted some of the same tactics.

“He plays people off against one another, he attempts to inspire fear rather than respect, he is unpredictable and he is 100% focused on eliminating the opposition,” the senior Conservative explained.

http://www.canada.com/nationalpost/story.html?id=eaf90e25-6d16-4156-8cec-a735d758144b&k

#191 Timbo on 04.05.13 at 1:19 pm

http://www.telegraph.co.uk/news/worldnews/europe/eu/9971786/Baroness-Ashton-will-be-paid-400000-by-the-EU-to-do-nothing.html

“Baroness Ashton will be paid £400,000 by the EU to do nothing

It’s important that commissioners don’t start looking for a new job during the last months of their mandate, and that they take their time over finding appropriate new employment,” said a commission spokesman.

That way, they can continue to give 100 per cent to the job taxpayers are paying them to do, and there is much less risk of a conflict of interest.”

Nice Severance. No class warfare here…move along…

http://www.bbc.co.uk/news/world-europe-22041122

“The Cyprus Mail website says information provided by Bank of Cyprus was incomplete and data-deleting software was found on some computers there.

There were significant gaps in computer records for the period 2007-2010. It is not yet clear whether the wiping of records was accidental or deliberate. There were signs of mass deletion of data. ”

Talk about a spectacular
smash and grab with no paper trail……

#192 Richard in Kelowna on 04.05.13 at 1:19 pm

“TSX flirting with the 200DMA this morning. Let’s hope it holds…otherwise could get pretty ugly….Weak, unexpected US and Canadian job numbers just one of the reasons for stock markets to take a breather…

A correction would be welcome. — Garth”
……………………………………………………………………

You may be right Garth with this just a much needed correction but it always troubles me when the so called informed and smart money are virtually all of the same opinion, and they get it wrong and which happens too often…witness the jobs reports out today…

Weak reports were expected. That’s why the markets are down marginally. — Garth
……………………………………………………………….

BNN said this morning that ALL the economists got the jobs numbers wrong so I guess you and I are listening to different experts…

A shocking jobs report would not have resulted in such a tepid reaction. The consensus expectation was for 200,000 US jobs, and 88,000 were delivered. Weak, not stunning. — Garth

#193 Daisy Mae on 04.05.13 at 1:19 pm

#142 Stickler: “When someone opens a bank account and makes a deposit, the account holder surrenders legal title to the cash. This cash becomes an asset of the bank.”

*****************

The depositor does NOT surrender legal title to their money. Crazy talk.

#194 Daisy Mae on 04.05.13 at 1:24 pm

#145 Neo: “By the way, back in North America. Realllllly strong job growth this March….”

******************

You’re joking, right? We lost 54,500 jobs this March.

#195 Daisy Mae on 04.05.13 at 1:36 pm

CBC: Job losses in BC alone — “The latest jobs figures from Statistics Canada show a spike in unemployment in B.C.

The rate jumped to 7 per cent in March, up from 6.3 per cent in February — the biggest rise in the country and a loss of more than 22,000 full-time jobs.”

#196 Kessel on 04.05.13 at 1:39 pm

Garth, all the houses in Woodbridge are selling for higher than they did last spring. I’ve been renting for a year hoping for some kind of decline but nothing yet. Will housing ever decline without either an interest rate or unemployment shock?

Don’t have a lot of patience, do you? — Garth

#197 jess on 04.05.13 at 1:43 pm

“anatomical material.”
maybe those unmarked graves are empty
http://www.icij.org/human-corpses-are-prize-global-drive-profits

#198 Andrew on 04.05.13 at 1:44 pm

#104 John

“How can we explain house prices in Edmonton now approaching their highest levels ever (2007 levels)? Sales are down about 6% when comparing March 2013 to March 2012. Single family detached homes are up 7% in the same time period. Reading this blog would lead most readers to believe that prices are going to drop in every city across the country…

Could Garth be wrong on Edmonton?”

————————————————

Checkout this week’s sales report from the good folks at the Edmonton Real Estate blog, I believe they used the word “nosedive”…..

http://edmontonrealestateblog.com/2013/04/edmonton-real-estate-market-weekly-update-april-513.html

#199 Mike on 04.05.13 at 1:49 pm

Must be pretty frustrating Garth to see that most of your readers do not share your views when it comes to this miracle (mirage :)) that’s the US economic recovery.
Seems like nowadays the comments section is a continuous parade of arguments, you seem to have latched into your perma-bull state of mind and are pushing aside all arguments that don’t share your views.
I really think you should stick with RE and talk investing strategies with your clients not blog readers :)

Interesting that 1% of people people who read this blog leave a comment. Also that stocks markets have doubled in four years and the world is improving. Must tear you up. — Garth

#200 Old Man on 04.05.13 at 1:51 pm

The employment figures came out and all is bad, as am busy with my Income Tax filing and hope all has come in, as will know by this Sunday, as too much stuff comes in late, and this is not right. All bad news is an emotion to sell on negative news, and buy on positive news which is not investing at all. So be not afraid of ups and downs; be very afraid in Toronto of the Real Estate market, as you that bought condos in the core are going to be underwater for the next 10 years with a slow meltdown; nope it will be a fast crash, so saddle up for a surprise.

#201 Devore on 04.05.13 at 1:53 pm

#191 zeeman1

Visa or Amex dollars, for instance?

I’m a fan of Canadian Tire money myself.

#202 Devore on 04.05.13 at 2:01 pm

#195 Daisy Mae

The depositor does NOT surrender legal title to their money. Crazy talk.

People are reading way too much into this. You don’t have any “legal title” to money, first of all. What would you have title to anyways, the serial numbers?

Second, when you hand over money to someone for safekeeping, they take the money from you, which naturally becomes their asset, balanced by the liability of having to return it to you.

This is simple double entry bookkeeping, not a conspiracy. Been around for a few centuries. Some folks here might want to look it up.

#203 Dr. Hoof - Hearted on 04.05.13 at 2:05 pm

From VREAA:

“I know someone in BC who just declared bankruptcy because her condo was assessed at $150k and she bought it north of $250k in 2005 or 2006 (presale). Tried to rent it out for the past few years but the rents kept drifting lower and lower, and the tenants stayed shorter and shorter terms (I think they moved on to better places, this is a city in BC where rents are down significantly since there was a boom-the boom is long over). She was losing more than $10,000 a year and just couldn’t get ahead. Time to hand the keys back to the bank and start over.

I hear stories like this all the time. A friend’s dad in the same city bought a house during the boom “everyone wants to live here!”. Now his mortgage is $2500/month (blue collar worker) and he tries to rent out the basement suite for $1000 a month (no takers-though it worked during the boom). The house is worth about 30% less than what he paid for it (maybe less, not a lot of sales these days).

All we have to do is look north a bit to see these stories.
Quiet suffering. These stories don’t seem to make the news but they do exist.”

#204 Dr. Hoof - Hearted on 04.05.13 at 2:14 pm

From VREAA

http://vreaa.wordpress.com/2013/04/02/she-said-the-market-was-dead-in-victoria-and-that-it-would-remain-so-for-a-very-long-time-i-asked-how-she-knew-her-answer-was-fascinating-and-should-scare-the-pants-off-the-real-estate-crowd/

“Yesterday two old friends, J & M, from Victoria, mid 50′s, both very bright and mid level bureaucrats at separate provincial government departments came to visit us in the Comox Valley. At one point the topic moved to real estate. I began to say that the market was dead here when J interjected that it is the same in Victoria and that it would remain so for a very long time. I was surprised by her response and asked how she knew this because I know that neither of them reads any of the real estate bear blogs. Their answer was fascinating and should scare the pants off the real estate crowd.

First, both live in Townhouses and J is the head of her strata council (46 units). She said that last year about 7 units sold. This year one of the most desireable units was listed and got no inquiries at all. It was pulled. In addition one of the vendors of a unit last year did want to buy back in but could only do so with a 0/40 mortgage, which is of course no longer available. She had no idea what he had done with the equity from the sale.

Second both pointed out that their incomes have remained largely static for years but that housing prices and strata fees (not to mention special assessments) have increased relentlessly to the point where they felt prices are ridiculous relative to income. J was of the opinion that the townhouse unit in which she lives has about $60K of material in it and yet these units were until recently selling for $300k plus. She felt that the spread between material cost and selling price was indefensible. J also pointed out that despite being mortgage free her strata fees and hydro per month were in excess of $500, the better part of a mortgage payment not that long ago.

Third J said that the price of real estate would be down basically forever because our generation had had few children, overall. As a result who was going to buy our houses when we depart for the great hereafter?

Fourth both believe that the potential sales price of their own units have decreased substantially in the past year and will probably continue to decrease but they intend to stay put. They do not see any point, for example, in selling and then renting despite knowing that prices are inflated vis a vis rent.

Fifth both pointed out that they work at very large institutions and that they, of course, interact with many of their fellow employees. One of the constant topics is real estate and these days the virtual impossibility of finding buyers for the units that their fellow employees have for sale. They report that the view of the majority of their fellow employees is similar to their own – real estate is dead.

Finally, and very ironically, at least for most of us at this site, both get most of their news from CBC and CTV. Their overall impression of reports on both channels was that the real estate market is collapsing.”

#205 Dupcheck on 04.05.13 at 2:29 pm

I bet you did not know that Cyprus was a common wealth country.

#206 Dr. Oblivious on 04.05.13 at 2:43 pm

As opposed to play money? (But I love the little CIA story. Makes it so real.) — Garth

No,no it’s true the CIA asked me for some bitcoins and then they waterboarded them!

#207 spaceman on 04.05.13 at 2:49 pm

Bitcoins are a result of work by hundreds of computers generating the equivelent of a prime #. Once a block is completed, it earns 1 bitcoin. As more people get involved, the demand is increasing, and therefore a bitcoin gains value. its like a gold nugget, it takes a lot of work to dig it up, find it etc. It only has the value that we assign it. Same with bitcoins. Inflation of bitcoins is therefore something like 1000% but at a certain point in time, the value will half itself.

Apparently you can use them to by socks, and bullets for your automatic rifle, but they have value to other bitcoin investors/collectors.

#208 rosie "moving backwards" on 04.05.13 at 2:50 pm

#176 TS

I choose glod. It even sounds safe.

#209 Humpty Dumpty on 04.05.13 at 2:59 pm

Commies….

All government embassies have been instructed to evacuate staff from Pyongyang after dictator Kim Jong-un warned he could not ‘guarantee the safety of foreigners.’

The rogue communist state issued a deadline of April 10 to every government that is represented in North Korea in a dramatic new escalation of the nuclear crisis.

http://www.dailymail.co.uk/news/article-2304287/North-Korea-latest-West-slams-Kim-Jong-Un-madman-dictator-pictured-brandishing-gun.html

#210 Stew on 04.05.13 at 3:04 pm

DELETED

#211 bill on 04.05.13 at 3:09 pm

apparently the re market is worse in Saskatchewan than previously thought… or its the long winters.

https://wm.shaw.ca/service/home/~/Saskatchewan%27s%20Got%20Talent.wmv?auth=co&loc=en_US&id=14404&part=2

#212 Tri State Pat on 04.05.13 at 3:24 pm

#21 MSM Observer

Wow.

That would be a good story for a respectable news reporting entity to pick up since it looks like LCN is trying to spread incorrect information to the public. Is it corruption or collusion…Hmmmmmmm…

#213 Humpty Dumpty on 04.05.13 at 3:43 pm

The Assault On Gold — Paul Craig Roberts

The Federal Reserve used its dependent “banks too big to fail” to short the precious metals markets. By selling naked shorts in the paper bullion market against the rising demand for physical possession, the Federal Reserve was able to drive the price of gold down to $1,750 and keep it more or less capped there until recently, when a concerted effort on April 2-3, 2013, drove gold down to $1,557 and silver, which had approached $50 per ounce in 2011, down to $27.

The Federal Reserve began its April Fool’s assault on gold by sending the word to brokerage houses, which quickly went out to clients, that hedge funds and other large investors were going to unload their gold positions and that clients should get out of the precious metal market prior to these sales. As this inside information was the government’s own strategy, individuals cannot be prosecuted for acting on it. By this operation, the Federal Reserve, a totally corrupt entity, was able to combine individual flight with institutional flight. Bullion prices took a big hit, and bullishness departed from the gold and silver markets. The flow of dollars into bullion, which threatened to become a torrent, was stopped.

http://www.paulcraigroberts.org/2013/04/04/the-assault-on-gold-paul-craig-roberts/

Knight to your queen G… Check

And you believe this fiction? — Garth

#214 Real Estate Savvy on 04.05.13 at 3:49 pm

What are the intelligence quotients of people on this blog who stupidly claim they are first to post, most of them wrong.

They sound like 4 year olds in the sand pit.

#215 PRICES IN THE GTA ARE CRASHING on 04.05.13 at 3:52 pm

jwk=- on 04.05.13 at 9:41 am
I am seeing the slow down on the ground in my ‘desirable’ area of toronto (note: all areas of Toronto are desirable per realtors) . There is a semi backsplit that had three back to back open house weekends. We went when there was 2ft of snow on the ground and price was $499k, offers on Tuesday at 7pm. Dropped to 479. now 7 weeks later at 465. The bung around the corner (nicely renovated, not over the top, practical and very well finished.) for 550k is off the market unsold. Loved the bung, but won’t buy anything smaller than our leased side split now.

This is the same hood we used to cruise last summer. back then about half theopen houses were cancelled as it was sold already or held to collect potential buyers who were told it was sold already. Our poor relator was checking listings every 2-4 hours to give us a chance….what a difference! I would go 329 on the backsplit, tops.
—————————————————————–

NOTHING is selling and even with realtors manipulated number sales CRASHED 20%. The fact is sales crashed even more then that. Some realtors have not made a sale in over a year . Remember if you don’t buy it no one will. GTA overvalued by 40-50%

#216 Old Man on 04.05.13 at 3:57 pm

Bitcoins is the biggest ponzi scheme in the world, and should be shutdown, as this is all an illusion that is far from the real world using real money for transactions and some say fiat money is not real – nonsense. Just try to buy groceries with a gold bar, and they might call the cops on you.

#217 bill on 04.05.13 at 4:02 pm

”I’m a fan of Canadian Tire money myself.”
absolutely. the only currency in the world backed by maple syrup. as solid as a Coleman stove. and very liquid….

#218 Tom Vu on 04.05.13 at 4:05 pm

#212 Humpty Dumpty on 04.05.13 at 2:59 pm

Commies….

All government embassies have been instructed to evacuate staff from Pyongyang after dictator Kim Jong-un warned he could not ‘guarantee the safety of foreigners.’

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

Could be worse….could be Ontario.

#219 renting and waiting no more on 04.05.13 at 4:14 pm

seems there’s a lot of apologizing for the status quo going on today. Usually that means someone is white knuckling it through fear, or they are arrogant because they are on side with the bad guys.

Does anyone believe that the people of Cyprus thought this was going to happen to them? Does anyone wonder if their wasn’t a Cypriot bank apologist running around telling everyone ‘it’s different here’ ?

The stock market is a huge, enormous casino. It seems to me like multinational financiers are pretty angry that not everyone has anted up, and they are going directly into bank accounts now to force savers into the rigged game.

could happen anywhere. of course it could.

Where are the normal people? This blog needs you. — Garth

#220 Old Man on 04.05.13 at 4:17 pm

I went today to make several retail purchases, and ahead of me was a woman about 50 years old that had money, so for $20.00 inserted her credit card into that little machine and messed up; tried again and messed up, as she had been drinking. I knew the manager well, as was behind her, and she said omg am using the wrong credit card. I am a smart ass so cracked a joke and said that is why I use cash only, and she was laughing her head off, and delayed her purchase once again.

#221 Tony on 04.05.13 at 4:23 pm

Re: #200 Andrew on 04.05.13 at 1:44 pm

New houses cost so much more than resales but only in the province of Alberta. Albertans have a rare extra gene that’s inbred into them to buy new so new is about 50 percent more than resale instead of the Canada wide average of 10.

#222 espressobob on 04.05.13 at 4:24 pm

#176 TS

Why not pick up a copy of ‘ investing for Canadians for dummies ‘. Great read! Along with some ice cold yagermeister. Relax.

#223 zeeman1 on 04.05.13 at 4:41 pm

Garth,

No surprise Obama and others are looking into shutting down Bitcoin

Bitcoin is the first major player in the alternative currency game, and the Feds are rightfully scared shitless.

How can they keep playing their money games with Bitcoin and other competing currencies that can’t be devalued and printed at the whims of a government?

Ask yourself why government needs to have a monopoly on currency, and look at the history behind it.

There’s no reason why we shouldn’t encourage alternatives, as competition is best for the end user, even as far as money is concerned.

Nobody actually cares. Dream on. — Garth

#224 afraidit allmightend on 04.05.13 at 4:42 pm

You’re convinced that your ideology will lead to happiness and prosperity…..and the other 50% are convinced they’re never going to enjoy the same luxury.

“Whatever. I’m more interested in having a prosperous and enjoyable life. It’s the only one I get. — Garth”

Conflict is inevitable …. as is change….look around…..your happiness is in no way assured.

And if you think that the ‘bail – in ‘ strategy is not bubbling away on the back burner….then why has it been adopted as policy in every western governments contingency planning to continue support for the status quo?

F is a fairly literate gent….do you think it just slipped in to the budget.?…the strategy can and will be used. They’re more or less telegraphing that it will.

Our governments are spending in excess of 100% of GDP…..( Australia is passing 277%…its surprising their currency is still trading) direct and indirect taxation has surpassed 80% in Canada …..Japan has pinned it’s hopes on QEnormous trillions….at 250% of GDP….savings are all thats left….how else are the elites going to continue to draw pay and pension if not further subsidized by the taxpayer?

I wonder about you G……you might be whistling past the graveyard.

#225 Canadian Watchdog on 04.05.13 at 4:53 pm

#219 Old Man
Bitcoins is the biggest ponzi scheme in the world, and should be shutdown.

Why should it be shut down? It's an uninsured virtual currency scheme that poses no liabilities to taxpayers, so if people want to risk their money in it, so be it.

#226 betamax on 04.05.13 at 5:00 pm

#121 drydock: “It’s losing , not loosing.”

Whaat aare youu tryying to saay? Youu’ve loost mee.

#227 Humpty Dumpty on 04.05.13 at 5:19 pm

Didn’t say I believed him, however there are things that make you go Hmmm…

https://d21uq3hx4esec9.cloudfront.net/images/uploads/ttmygh/6391/Apr_1_2013_TTMYGH.pdf

Bishop to your queen G…. check…

http://www.greaterfool.ca/2013/04/03/when-bulls-croak/#comment-233686

#228 rosie "moving backwards" on 04.05.13 at 5:23 pm

# 222

Sound reasoning. http://funnyasduck.net/wp-content/uploads/2013/03/funny-george-carlin-think-how-stupid-average-person-is-half-stupider-quote-pics.jpg

#229 Mike on 04.05.13 at 5:39 pm

Must be pretty frustrating Garth to see that most of your readers do not share your views when it comes to this miracle (mirage :)) that’s the US economic recovery.
Seems like nowadays the comments section is a continuous parade of arguments, you seem to have latched into your perma-bull state of mind and are pushing aside all arguments that don’t share your views.
I really think you should stick with RE and talk investing strategies with your clients not blog readers :)
……………………………
Interesting that 1% of people people who read this blog leave a comment. Also that stocks markets have doubled in four years and the world is improving. Must tear you up. — Garth
……………………………..
Well .. no, it doesn’t tear me up at all. I enjoy my good night sleeps nowadays. Out of this casino for a while until I see value again. Will let deflation increase the buying power of my money and will be ready to fetch up ETFs again when it makes sense, a LOOONG way down from here.
I kind of get the feeling though that you are getting frustrated. :)

Actually I am saddened a little so many people feel suspicious, mistrustful, detached. Life will be harder for them. — Garth

#230 jo on 04.05.13 at 6:17 pm

Thanks Garth I can always count on you to give us the facts. That is why I come to your blog everyday to learn about what matters most.

#231 afraidit allmightend on 04.05.13 at 6:19 pm

The uninisured deposits the fed has allude to include amounts over 100K and Mutual Funds …..and any unspecified accounts that the government has yet to clarify. BTW.

http://www.thestar.com/news/canada/2013/04/04/jim_flahertys_cyprusstyle_bank_rescue_plan_walkom.html

G….it isn’t a fantasy or an impossibility that F is planning cash confiscation….telling people not to worry is irresponsible.

#232 a reader on 04.05.13 at 6:20 pm

Pretty shabby treatment of the Neil MacDonald article. There were, by my count, 30+ paragraphs between the first half of the quote you created for him and the “…” connecting the last half of the quote. There’s a lot of qualification between those three dots, including prominent quotes from a TD exec who likes what the government is doing. Sure, Neil’s a sceptic of the government’s reassurances, but I certainly didn’t finish his piece thinking my meagre deposits are at risk. Bear in mind, your own conclusion only describes what “banks will likely soon be required” to do, aka ‘Contingent Capital’ — Neil’s article describes the same scenario in the 3 dots left out of the only quote you gave him. Also would it wouldn’t hurt to link to the articles you quote.

Is my free blog not annotated enough for you? Sheesh. — Garth

#233 Kevin on 04.05.13 at 6:22 pm

Garth,
Here is average house price growth from 1956 to 2012 along with the average weekly wage growth. Enjoy

http://4.bp.blogspot.com/-AqH-4xLetuk/UV9FYgR6i1I/AAAAAAAAF8s/_n0qVUo1CaE/s1600/Growth+in+Canada,+Index+Base+1956+=100.jpg

That’s all you need to know. Screwed. — Garth

#234 espressobob on 04.05.13 at 6:28 pm

#233 Mike

If you think about it investing is for the long haul. Many a dividend ETF chuck out monthly/quarterly distribution. Whats the problem?

If you need the cash in the near future why on earth would anyone pile into equity’s?

#235 Old Man on 04.05.13 at 6:34 pm

#228 Canadian Watchdog – buy in and wish you the best of luck, as have an oceanfront property forsale in the State of Montana that will sell to you for a huge discount – and will even take back a first mortgage as a VTB.

#236 TK on 04.05.13 at 6:46 pm

As much as I value greatly your opinion and reading your blog is my daily routine I don’t quite understand your confidence in the safety of our deposits in Canadian banks. Explanation what exactly Goverment means when they say “banks liability” would clear this issue at once. It surely looks like bank deposit seizure (or taxing) is new reality in Europe. Would be foolish to think that it will never happen again.

Already explained. Deposits not included. End of story. — Garth

#237 Joe on 04.05.13 at 6:52 pm

Garth the fact that you seem to endorse the endless printing of money as a acceptable solution blows my mind, I get the concept but its never worked, its insane. This will end poorly and there will be buckets of tears, the FED will pull the carpet one day. Im not trying to get conspiratorial but whats to stop the FED who is privately owned from buying up precious metals, as you know money can be made when prices go up or down. Why wouldn’t they buy everything worth anything and then leverage it against the public.

Hello? Are there a-n-y normal people out there? — Garth

#238 blinded on 04.05.13 at 6:57 pm

The whole financial world lives on a debt model by creating paper money out of thin air with interest backed by fudging bankrupt governments and then banks leveraging that debt and hypothecating it multiple times and slicing and dicing globally into synthetic derivatives casino of over $quadrillion to gamble in the attempt to make a profit.

Canada, fully integrated into that scheme, is planning to offer “a special class of shares or bail-in bonds” that are unsecured so that investors can participate in the fun of not losing money.

Fearless is not the right adjective to describe such folks.

I’d by them in a heartbeat. — Garth

#239 TurnerNation on 04.05.13 at 7:11 pm

In effect “Operation Yield Crush” is back this week.

TLT: It’s dynamite.

#240 Smoking Man on 04.05.13 at 7:13 pm

Bubbley bubble heads, dogs gloomers, gold bugs…

Pre drinking at center bar at the great senica casino, got my assignment kicked huge today trading. I did a double stupid…. Hahaha good thing money created out of thin air…..

Next best thing to Floyd, the machine….. At the bears den, just trying to get in the zone right now… Wana talk about my failed camel toe, but I just got distracted by one…

Should be a good night, garth, you know drill delete button ready

I love life what a buzz.

#241 TurnerNation on 04.05.13 at 7:22 pm

NDP govt? H, F eat your hearts out.

>Nova Scotia tables $16 million surplus

Small business tax rate reduced to 3%

By Keith Doucette | April 04, 2013 13:50
Source: The Canadian Press

Nova Scotia’s NDP government tabled a slim surplus Thursday of $16.4 million in a budget that aims to appeal to the public before an election call that could happen later this year.

Maureen MacDonald’s $9.5-billion budget, her first as the province’s finance minister, is propped up by an anticipated boost of $233.6 million in provincial revenues and another $86 million in departmental spending cuts.

MacDonald said the balanced budget for 2013-14 marks a landmark achievement for a government that initially promised surpluses in each of the last three years but was hampered by global economic forces beyond its control.

“We are back to balance despite three years of modest revenue growth, not through hoping and wishing,” MacDonald said in her budget speech to the legislature.

“There have been some bumps along the way, but collectively we have a lot to show for our efforts.”

Some departments such as Education, Economic Development and Community Services will face cuts. But the Health Department, the government’s largest expenditure, will see a small increase of $51 million, bringing overall spending to $3.9 billion.

The government is also increasing the tax on tobacco by two cents per cigarette as of Friday, a measure expected to rake in $18.1 million.

#242 brainsail on 04.05.13 at 7:28 pm

“Canada loses 54,500 jobs in March, unemployment rises to 7.2 per cent”

Read the comments. There are a lot of unhappy citizens.

http://www.ctvnews.ca/business/canada-loses-54-500-jobs-in-march-unemployment-rises-to-7-2-per-cent-1.1225328

#243 Daisy Mae on 04.05.13 at 7:38 pm

#204 Devore — Deposits are ‘liabilities’ — they can be withdrawn as quickly as they can be deposited.

As far as ‘legal title’ is concerned, consider it a figure of speech. If the depositor doesn’t have ‘legal title’ to his money, no one does.

#244 bill on 04.05.13 at 7:39 pm

”Hello? Are there a-n-y normal people out there? — Garth”
nope. just a bunch named Abby…
http://www.youtube.com/watch?v=yH97lImrr0Q

#245 Smoking Man on 04.05.13 at 7:40 pm

Ok Been trading, and this smoking man hilarious, Ok getting harder to type, can belive the dog a customs walked right by my Jamaica ambiance

So trading USDCAD For two weeks this week I go for the volatile cable… For you virgins that’s GPBUSD, now I’m thinking sell means sell USA.

I new the job numbers would be shit, so I go sell USD except I do it back wards.. Such an idiot….. Guy on the floor says shit job numbers will have an opposite reaction. 830 boom shit numbers I see the candle stick go to orbit… Ya baby I’m thinking. Problem I was George Castanza iinverted. My logic a guess perfect, execution a 69.

That’s how a smoking man learns….

#246 Old Man on 04.05.13 at 7:40 pm

I am old fashion in my sordid life as cash is king, and have no debit cards, and just two credit cards that I rarely use, and only write out one cheque a month, or two as a counter cheque, as pay all in cash, so a date with me the women in my life will not see a credit card to pay any bill ever. Why? I do it all my way.

#247 Daisy Mae on 04.05.13 at 7:50 pm

#220bill: ”I’m a fan of Canadian Tire money myself.”
absolutely. the only currency in the world backed by maple syrup. as solid as a Coleman stove. and very liquid….”

******************

We need abit of levity! Thanks for the laugh.

#248 Old Man on 04.05.13 at 7:58 pm

I want to make another statement that involves this debt mess in Canada, as shop on a daily basis as have nothing else better to do in life, as have an old car that needs a run. I see women making a purchase and they have no less than 8 credit cards in their wallet. This is insane as one only needs two credit cards, and one is a Visa and the other is Mastercard – no more!

#249 Daisy Mae on 04.05.13 at 8:04 pm

#227 Afraitit: “Whatever. I’m more interested in having a prosperous and enjoyable life. It’s the only one I get. — Garth”

“Conflict is inevitable …. as is change….look around…..your happiness is in no way assured.”

******************

Financial security goes a long way towards a feeling of safety and that translates into happiness, contentment and enjoyment of life. Ideally, we should all feel this way. However, the majority don’t…

#250 Tom Vu on 04.05.13 at 8:11 pm

It is almost time for the race to be FIRST on next post.

#251 Smoking Man on 04.05.13 at 8:12 pm

Chairmen best seat in the house, the question, do they throw me out when I light one…..

#252 Smoking Man on 04.05.13 at 8:18 pm

DELETED

#253 Joe on 04.05.13 at 8:31 pm

241 Garth…are there any normal people out there.
Define normal: Was the Libor rate rigging normal?
Geithner admitted he knew about it.
I’m not sure what you classify as normal considering some of the unethical banking practices of late.
Why is it so crazy to consider that the metal markets are being manipulated also?
Seriously.

#254 Mike on 04.05.13 at 8:41 pm

#238 espressobob on 04.05.13 at 6:28 pm
#233 Mike

If you think about it investing is for the long haul. Many a dividend ETF chuck out monthly/quarterly distribution. Whats the problem?

If you need the cash in the near future why on earth would anyone pile into equity’s?
………………………………….
Well Bob, I don’t buy the crap the sell side “advisors” are pushing about “investing is for the long haul” and ” it’s not timing the market it is time in the market”. There has always been and there will always be a business cycle. So, NO, being invested All the time does not make sense and YES, you can definitely time the market to a certain degree. Now, mind you, you won’t be able to get in at the bottom and out at the top, does not matter. As long as you are out before the herd starts getting out, you’r going to do much much better than the ones that stay “invested” all the time.
Of course now we have the FED basically distorting everything and making it harder to read the business cycle and anticipate the ups and downs of the market. But don’t for a second think that the FED will be able to avoid the business cycle. They have never been able to do so and won’t ever be successful at it either :)
They do what they do right now because there is no alternative solution. Anyways, I don’t know whether it will backfire tomorrow or next year, I just know that I made the decision some time ago that I don’t want to be part of this non-sense and am working on refreshing my list of ETFs that I’m going to buy when valuations come crashing done … you know, when we will hear that flushing the toilet sound again!

You really should learn about rebalancing. Trying to time the market, as you suggest, is idiocy. — Garth

#255 CrowdedElevatorfartz on 04.05.13 at 8:43 pm

@#55
ahhhh yessss,
Mr “Copy and Paste” is at it again.
The man of many plaguristic words…..
And not an original thought in his forcep squeezed cranium…….
Dr Wayne? Can you help this individual?

#256 to_be_frank on 04.06.13 at 12:42 am

CDIC is supposed to indemnify all bank deposits up to $100,000 per insured account. However, according to the CDIC Annual Report (2012) http://www.cdic.ca/CDIC/FinRpts/Documents/AR2012/AR2012.pdf they have only $2.441 billion of cash and investments on hand. CIBC is the smallest of the big 5 banks, and according to its 2012 annual report http://annualreport.cibc.com/downloads/CIBC_2012AR.pdf has account holder deposits of $300 billion. We had better not have a failure of one of the big five — CIDC assets would cover less than 1 penny per dollar. Do you think the banks will raise sufficient contingent capital to cover the other 99 cents, at premium interest rates? Carney suggested it in 2010 and so far the banks haven’t raised any. So the only other bail-in funds available would be deposits, including insured deposits, in all liklihood. Any assurance that these won’t be touched is as credible as an election promise.

No bank will fail. No deposits will be touched. Ottawa made the latter clear yesterday. — Garth

#257 hagbard on 04.06.13 at 8:08 am

“In the last week realtors have used their Facebook pages to suggest that when (not if) the banks fail and your money is stolen, you’ll wish you’d bought a house.”

That’s us. I don’t trust the banks or the govt. Seem five places in the past few days. We’re not in TO, Van or Victoria, but Essex county..still somewhat affordable here.

#258 hagbard on 04.06.13 at 8:28 am

@ #260 to_be_frank –

If the banks bail-in to depositor’s money and don’t go bankrupt then the insurance won’t kick in anyway. The insurance is dependent on the bank actually going under. Nice catch-22 eh?

#259 M on 04.06.13 at 5:17 pm

Garth… just because some assholes decided to print money it doesn’t make for the banks to be any different from any other business. If the assets are badly managed any and every business will fail. What’s so special about banks ?
Aren’t the banks these days the worst managed businesses ?
You said it yourself, 70% + …have a mortgage.
If “amazing” = banks going belly up or depositors/investors losing … then prepare yourself to be amazed at some point.
Financial mambo-jambo is no different than techie mambo-jambo in 2001.
When something stops being productive, it will die. A simple law of nature.