The dilemma

KEITH modified

Is it tougher now than in the past to be a young hottie? Marlene thinks so. Especially when you live on the West Coast, where it rains hormones. “I love your blog and have been reading it every day for the last 2 years,” says the 35-year-old who’s single and makes $120,000. (Her email addy will be raffled off at the end of this post). “Anyway, my question to you is what’s a millennial to do these days?”

Marlene feels caught. Events of the last few days sure haven’t helped. Stock markets laid another egg Monday, spooked by slow growth and slumping oil, just as a new wave of greed was sweeping through the hoods of Vancouver in the wake of FlipGate and revelations speckers there have discovered assignment clauses.

“This is my dilemma,” she says. “I can’t afford a house (don’t want a condo), even an hour and a half into the sticks. Unaffordability has spread well beyond Van and is getting worse daily.  Therefore, I have maxed out my TFSAs and contribute a healthy amount to RRSPs, mostly invested in a fairly balanced portfolio.  Many of those investments are on a major decline and predicted to fall over 50% from today’s date.  Nasdaq being a good example.  Should I sell and save the headache?  This invested money is also my savings for a downpayment if that day ever comes.

“So to recap, I can’t afford to buy a home and all my investments are losing big time. That’s negative growth in a booming city.  What are my options??? Is there any hope for all the millennials in my position? On a side note: If I have lost money in a TFSA and have sold all investments within, can I top it back up?”

First, the side note: no, you can’t. Losses within a TFSA are forever gone. You cannot inject new money into the TFSA to replace them, nor can you deduct them from future gains. However if you removed the assets inside the plan, and they later lost money, you could replace the TFSA withdrawal in its entirety the following calendar year.

Now, what’s goin’ on with markets?

There’s a big sale. Because recent events have not turned out as many people expected, large investors (who move markets, as opposed to you) have been sucking money out of equities and putting it into safe havens, like the US dollar or government bonds. Of course, these guys can afford to do what most of us can’t – which is to sacrifice growth and receive nothing, in return for parking their cash. (Institutional investors don’t have retirements to fund or kids to educate.) Once they sense a bottom is in, they rush back.

Markets are unhappy with slowing global growth, the slide in commodity values, the nutjob running North Korea, uncertainty over the Chinese economy, the course of US interest rates and, in Canada, record debt, oilageddon and house lust.

The question here is whether or not this should worry a 35-year-old. The answer is no. Unless she’s dumb enough to want to convert all her liquid wealth into a single real estate asset in the most over-valued market in North America, just prior to its inevitable correction. In that case, don’t invest. Do not risk any short-term declines. When you buy the house you’ll have all the risk you can stomach.

In contrast, a 35-year-old babe with money to invest in a portfolio has picked a fine moment to do so. Logic tells us the current market plop (even if it’s not finished yet) is overdone. The global economy is still expanding, not contracting. That means the commodity collapse is illogical, with demand for stuff like oil actually rising. Cheaper energy is also, logically, a serious boon for both consumers and consuming countries. People can spend more money buying F-150s, and less on gas, creating and sustaining manufacturing jobs. Besides, the commodity crisis is getting old. There’ll be a significant snapback because (a) the US is still swelling, (b) every week there are more humans yet no more planet and (c) the world still runs on oil and copper, aluminium or grain.

So, Marlene, stop being a wuss. If you have a well-balanced, globally-diversified portfolio there’s only one ingredient you’re missing. Patience. Selling an ETF when it’s low is as irrational as buying a house when it’s high. Emotion, not logic, leads people to fear lower lows and expect higher highs. It rarely turns out that way.

As for BC housing, check out this note Mike sent me Monday:

“There’s a story going around that the realtor Fraser Elliott in Ladner hired a helicopter to fly a woman from China around Ladner to look at 7 houses.  Apparently she didn’t look at any of them on the ground, bought all seven and asked to arrange to look at more the next day.”

By the way, this is Ladner, from a copter. Can’t you feel the buzz?

LADNER modified

I called Fraser Elliott at his Re/Max office and told him a GreaterFool Investigative Team would be kicking in his front door at any moment, Hoovering his Audi, then interrogating him mercilessly (waterboarding, if necessary) about the helo lady. Or was this just a rumour he’d started?

“That,” he told me. “is just ridiculous. And I wish I had a chopper.”

The fact people believe such tales, and trade them, tells us all we need to know about this market, Marlene. It’s a Millennial death trap.

206 comments ↓

#1 Doug t on 02.08.16 at 5:41 pm

First

#2 Keith in Calgary on 02.08.16 at 5:43 pm

Love the sign !!!!!

If you have no enemies it means you haven’t stood for anything in your life.

Anyways…….it’s a shame “property pimps” have taken such a shine to Audi’s……..that should do to their resale values what it did to the Cadillac STS……..the last great pimpmobile. Couldn’t give those things away as a result.

#3 Victoria Real Estate Update on 02.08.16 at 5:44 pm

IT ISN’T DIFFERENT IN CANADA

In the US, the biggest housing bubbles formed in California, Nevada, Arizona and Florida (think BC and Ontario). (See the second chart from Garth’s post, yesterday)

In all four of the above States, house prices fell back to levels last seen in 2000, when the US housing bubble began to inflate. In fact, prices in some states fell below (2000) pre-bubble levels (for example, Las Vegas).

Indeed the biggest price run-ups in the US were completely erased (or worse).

As in the US, Canada’s housing bubble also began to inflate in 2000 and is much bigger than the 2006 US housing bubble was.

The lowering of lending standards allowed housing bubbles to form in both countries. Canada lowered its lending standards more than in the US and the result has been predictable – a bigger bubble.

Those who think that house prices in BC and Ontario will fall a small amount, perhaps 10%, before turning around and moving higher again will be shocked and disappointed with how far house prices will fall in these provinces.

For those who think HAM makes Vancouver different, you are wrong. There was foreign investment in the above states as well before prices fell.

American economists, realtors and policy-makers predicted a small price correction for theIr housing market in 2005-06.

Sound familiar?

It’s always much worse than what they predict.

#4 Renter's Revenge! on 02.08.16 at 5:46 pm

Marlene:

Listen to your gut feelings… then do the opposite.

(Human guts have not evolved to deal with financial markets correctly yet.)

#5 The real Kip on 02.08.16 at 5:50 pm

Marlene, sell sell sell!

#6 souvereigninternational on 02.08.16 at 5:50 pm

Want future? Look to the past:

“2015 Year In Review
Scenic vistas from Mount Stupid”
by David Collum

http://www.peakprosperity.com/blog/95808/2015-year-review#gs

P.S. Got Splunked in half, but at least pm miners are back by double digits.

#7 Mean Gene on 02.08.16 at 5:52 pm

I would choose a ocean view house in Hawaii over a multi-million dollar dump in Vancouver or Ladner.

Common, get real.

#8 Ontario's Left Coast on 02.08.16 at 5:55 pm

I’m not a gold bug by any means but I am a fan of diversification. Anyway, on a day like today, I’m very pleased with my small position in some of the more stable miners of the yellow metal.

Good luck to all and hang in there during this rough patch.

#9 Suede on 02.08.16 at 5:55 pm

The herd is in a speculative orgy in YVR like no other.

Here’s another anecdote.

Cuz just sold a $2.3M house. Has 1.4 cash. They couldn’t afford the 900k mortgage even with a tenant. lol

Has lost out on 4 bidding wars to buy a beater they can buy outright and worst case, reno for 200k and a micro mortgage.

First world problems.

Wife is upset they can’t afford to live in Van now.

Omg

#10 Ontario's Left Coast on 02.08.16 at 5:56 pm

By the way, Garth, we’re still waiting for Marlene’s email address. Who’s kidding who, like any of us would be able to compete with Freedom First…

#11 Harbour on 02.08.16 at 5:58 pm

Sucks to have lost mega in your TFSA and can’t claim the Capital Losses

By the way… the Naz is at June 2014 level now.

#12 rational on 02.08.16 at 5:59 pm

Uh, Marlene at 35 isn’t young or hawt. For discussion, see this graph: http://therationalmale.com/2012/06/04/final-exam-navigating-the-smp/

But I’m still interested…lol..120K ..although after T2’s taxation doesn’t amount to much…

#13 zee on 02.08.16 at 5:59 pm

Hey Garth

Whats happening in the markets?
One day, you hear low oil prices are good, another day, its not.
Some days you hear that World Economy is expanding other days you hear we are going into a global recession.
US interest rates are going up and then next day its not and in fact it may get cut.
Last year, everyone was saying markets need to correct and when they do people say we are heading into a bear market.

Make sense of all this for me. Is it always like this.

#14 Frank on 02.08.16 at 6:00 pm

I sympathize with Marlene, a little younger, same income. Watching a portfolio take a beating is hard but doable.

What sucks is how unlivable this city is becoming. You’d think with all the supposed investors jumping in they’d be renting out their real estate to generate cash flow. Turns out vacancies are tighter than two coats of paint. You have to line up to find a place to buy (literally saw a line up at an open house down the street for a moldy 80’s condo because hey, it’s under $500K) or take a number for a rental suites because there are often over a dozen applications.

This city doesn’t have enough housing supply, it doesn’t justify the prices here but any way you slice it there is a huge squeeze.

#15 Ben Hurst on 02.08.16 at 6:00 pm

“large investors (who move markets, as opposed to you) have been sucking money out of equities and putting it into safe havens, like the US dollar or government bonds.”

And Gold too? At least somewhat?? Someone must be moving into gold.

#16 Madcat on 02.08.16 at 6:00 pm

Interesting… Seems Vancouverites are getting a little feisty about foreign ownership…

http://www.vancitybuzz.com/2015/05/petition-restrict-foreign-ownership-vancouver/

#17 bb on 02.08.16 at 6:01 pm

If she thinks markets are bearish for some time. Buy inverse ETFs.

#18 Brian Ripley on 02.08.16 at 6:01 pm

“…sucking money out of equities and putting it into safe havens…” Garth

Speaking of safe havens, I updated my Millionaire Metric chart: http://www.chpc.biz/millionaire-metric.html

Calgary single family dwellings priced in Gold is doing what it should…. correcting away from the notion that highly leveraged housing is a safe haven. Calgary SFD prices are back to 2011 levels. New “lows” are not that far away.

#19 Scott on 02.08.16 at 6:09 pm

The commodity collapse may be illogical but it can be illogical much longer than you can be solvent.

#20 MarketInquisitor on 02.08.16 at 6:09 pm

I saw many of you posting regarding preferred shares. I did an analysis on ZPR.TO on my new blog. Garth let me know if you disagree with anything.

http://marketinquisitor.com/2016/01/30/bullish-on-preferred-shares-zpr-to/

#21 A Yank in BC on 02.08.16 at 6:12 pm

Ladner. Be still by beating heart..

#22 Danforth on 02.08.16 at 6:15 pm

This recovery of you speak better come soon. I’m down 8.4% on the year to date, excluding today’s close!

But staying the course…not making any tweaks!

#23 souvereigninternational on 02.08.16 at 6:15 pm

Rewardless Risk:

http://www.salientpartners.com/epsilontheory/

“Negative rates are an intentional effort to weaken your own country’s banks. Negative rates are a punitive command: go out there and make more bad loans where risk is entirely uncompensated, or we will, in effect, fine you. The more bad loans you don’t make, the bigger the fine.”

#24 crowdedelevatorfartz on 02.08.16 at 6:16 pm

Marlene, if you and I get married……do I have to change my name?

#25 WallOfWorry on 02.08.16 at 6:22 pm

Garth,

Sincere question: With the evolution of day trading, bots etc, as well as the insidious greed that has overtaken Wall Street where it has been proven everything including the LIBOR rate is being manipulated, do you not consider that a buy and hold strategy in a balanced portfolio may be insufficient? I appreciate that long term investors have to mitigate risk, thus a balanced portfolio is key, I would challenge your thinking on the assumption that all is well within central bankers, the monetary system etc. If we have any concerns about deflation then holding some cash is important, if we have any concerns about the amount of liquidity creating asset bubbles then a 5% core holding in gold makes good sense. Over the past 15 + years a buy and hold strategy without considering the broader macro economic environment has been less than optimal.

#26 rk usa on 02.08.16 at 6:25 pm

35 year old making a 120K a year?

seems to be a lot Canadians making six figure salaries in their 30’s

#27 james on 02.08.16 at 6:26 pm

So Marlene was born in 80 or 81, making her GenX, not a millennial. Not only that, but 120k Canadian is 84k USD. In most states, taxes are lower than in Canada and living costs are FAR less. I’m guessing she is around the equivalent of 60k USD here in Seattle in that respect. Not bad, but not stunning. Lastly, 35 if the magic number when it comes to women giving birth.

The most worrying, however, is that she is itching to throw money into housing in the world’s second most over-inflated markets. Why not relocate? If she is a professional she could take advantage of a work visa to live in another country for a bit.

PS: Crazy markets. Our stock went to 827 per share and how to 690 a few days later. Oh well, at least I don’t work for LinkedIn.

#28 Why assignment clauses are fraud on 02.08.16 at 6:26 pm

What was not mentioned in the newspaper article on assignment clauses and related reselling tactics is this: a realtor representing a client who wants a property in a certain neighbourhood up to a certain max value would normally show houses to his clients and the asking price would be visible to the client. What happens here is that the realtor wants to sell a house to his own client at a much higher price and pocket the difference. So, the realtor asks a buddy realtor to bid on a house that would clearly interest the first realtor’s client and is priced well below that client’s max. Then using the assignment the house is presented to the client as being for sale at the higher amount, at or close to the client’s max. The realtors pocket the difference. That should be fraud punishable by prison sentence; the first realtor is not representing his own client at all, in conflict with even the most basic of fiduciary requirements. It is shocking. Variations of the above scheme abound. Amazing that the newspaper article completely ignored focusing on this scheme, they made it look as if profiting realtors just happen to find a new client who wants to buy at a higher price. That is not the case; they already know the client beforehand and are representing them directly or, more commonly in an effort to avoid suspicion, working with a buddy realtor who represents that client. The more realtors a firm has, the more its realtors are likely to be actively engaged in this fraud.

#29 understood by few on 02.08.16 at 6:26 pm

Bahahahaha. Ladner. The only way I’d buy a place there is from a helicopter too. No amenities, the facking Masey Tunnel, no one between the ages of 20-40… only good thing is a drive-thru beer store.

A friend just recently cashed out their Tsawwassen place at a cool 1.35 million (paid less than half around 6 years ago iirc.. but did dump 100K+ into renovating it).

As to Marlene (is she the infamous fake lawyer Marlene?): converting your investment to cash was silly and risky. Now you’ll have the stress of timing the bottom rather than just buying more to dollar cost average your investment. Might make you a few extra bucks if you can stomach pulling the trigger (to possibly face more losses before things turn around).

A down market is a good thing when you’re young and make money. As long as you have contribution room left, buy buy buy. I’m on my US clients like a hound to get invoices paid while the CAD is low and equities are shot. Could it stay like this a while? Sure.. but, like you, I have time on my side.

Whatever you do, don’t be tempted by some dirty bedroom community with “affordable” housing. Chilliwack and Sardis are still cheap, but for a reason (like the smell of chicken manure and a long shitty commute?). When things turn south the bedroom communities get hit hard.

Rent a nice condo close to work. Enjoy your life. Not owning gives so much more freedom. Spend that 1.5 hours you would spend commuting walking the seawall, or doing yoga in the park, or drinking coffee with some bearded fashion victim that doesn’t own a car and rides a fixed gear bike.. all of which are better than commuting. Think of all the yoga pants you can buy with the gas money you save.

#30 Stephen Fowler on 02.08.16 at 6:30 pm

I’ve read every post since post one over the years.

Thank you Garth for this blog. When times get tough in markets, it’s always reassuring to see that you are still on message. Reading the financial news tends to be counter-productive.

#31 Mark on 02.08.16 at 6:30 pm

“Calgary SFD prices are back to 2011 levels. New “lows” are not that far away.”

Don’t even need to do any trickery with gold pricing. Calgary prices are easily down 20% from the 2013 highs, which puts them back to 2010 levels, if not lower, in CAD$ terms. And even then, not much is moving.

Although Vancouver pricing is falling and getting more affordable (the hype involving a very tiny enclave of houses notwithstanding), the numbers are still off the charts. Even if she does lose 50% in stocks (which probably would only be possible by investing quite narrowly, such as into US tech firms, or US banks, for example), that’s far better than greater than 100% losses that are highly likely in leveraged RE ownership.

#32 Adam on 02.08.16 at 6:32 pm

The question still remains – if the housing market tanks, will those of us investing their downpayment today in hopes of more affordable housing tomorrow still have money available to make that happen? If housing crashes, won’t markets similarly crash? So, Marlene won’t have the assets available to invest when the time comes for her to make a buy.

#33 NoName on 02.08.16 at 6:35 pm

LOL

May I suggest frequent flyer
method of extraction, over waterboarding, no need for map, bucket and wet flor signs.

#34 S.Bby on 02.08.16 at 6:35 pm

I heard the same story 25 years ago: some woman from China flew into YVR, bought four houses in one day, and flew back to China the next day. This was back in the late 1980’s. Fact or fiction? Who knows. Some things never change.

#35 Ronaldo on 02.08.16 at 6:35 pm

NDP flipped out on flipping.

http://www.comoxvalleyrecord.com/national/vancouver/368090821.html

#36 acdel on 02.08.16 at 6:36 pm

#14 Frank
I sympathize with Marlene, a little younger, same income. Watching a portfolio take a beating is hard but doable.

What sucks is how unlivable this city is becoming. You’d think with all the supposed investors jumping in they’d be renting out their real estate to generate cash flow. Turns out vacancies are tighter than two coats of paint. You have to line up to find a place to buy (literally saw a line up at an open house down the street for a moldy 80’s condo because hey, it’s under $500K) or take a number for a rental suites because there are often over a dozen applications.

This city doesn’t have enough housing supply, it doesn’t justify the prices here but any way you slice it there is a huge squeeze.
—————————————————————–
Hit the nail on this comment; how can anyone in Canada that makes 120k a year not be able to afford a house? Disgraceful!

#37 powder_hound86 on 02.08.16 at 6:38 pm

This post reminds me of this:

https://www.youtube.com/watch?v=V9EbPxTm5_s

“That means the commodity collapse is illogical”

lol. Its illogical. It has nothing to do with a massive buildup in production that exceeds demand, nope its illogical. (to garth that is)

#38 espressobob on 02.08.16 at 6:41 pm

For what it is worth, if you want to make some impressive gains playing mr. market, buy into all the fear.

Works every time.

#39 Retired Boomer WI on 02.08.16 at 6:42 pm

Interesting ride on the street of WALL today. Got to buy four wonderful dividend payers at or even below my “buy” price. How did that happen you say? Well, this morning looked at orders. Two were getting close to my strike price so cancelled the orders. Checked a bit later they were below with no new adverse news to worry about, so I bought them.

By markets close, money in the bank!

Tonight I’ll be enjoying the porterhouse steak my wife bought on sale today for $7.49 a pound.
Somedays, even the geezer wins!
Old age & treachery will always overcome youth and skill.

#40 Scumop on 02.08.16 at 6:43 pm

You do need a lot of resolve when the market appears to be collapsing. If you set up a plan and rules, and they are reasonable, now is not the time to abandon them.

When you sell low, it just means someone else is buying low – buying your stuff. Do you really want that happening, someone feeding off the carcass of your abandoned investments?

As Garth pointed out, some things going on in the markets don’t make much sense.

At the moment. There are many future moments to come which will make much more sense and dollars.

Don’t panic; that just leads to you feeding the sharks.

Now is more the time to grow a big triangular fin on your back. Yum!

#41 Jeffrey of Saskatoon on 02.08.16 at 6:46 pm

A Hater is one who targets a successful indivdual for assassination based purely on spite and envy. Beware the Haters. They are legion.

#42 Millennial falcon on 02.08.16 at 6:47 pm

I too have a great dislike for Keith

#43 NoName on 02.08.16 at 6:49 pm

#15 Ben Hurst on 02.08.16

And copper too.
My Copper Penny Retirement
https://youtu.be/LnFcwanZ_uI

#YouCantMakeThisStufUp

#44 Smartalox on 02.08.16 at 6:50 pm

@ Yank in BC, try this:

Uh, Ladner. Is my heart still beating?

#45 Jingle Mail to Come? on 02.08.16 at 6:51 pm

1 negative jobs report down with probably 3 more negative jobs reports to come (March 11, 2016, April 8, 2016 and May 6, 2016) and then

let the Jingle Mail begin in YVR and later in 416.

Last 2016 growth reports keep getting revised down and down…attention K-Mart shoppers and reverse auctioneers:

Jan. 2015 Projection:
2.1% (IMF)

Jan. 2016 Projections:
1.7% (IMF)
1.4% (BofC)
1.3% (CIBC)

Feb. 2016 Projection:
1.1% (Scotiabank)

Do I hear 0%?

And not even the banks can do anything with underwater mortgages with job losses, a sagging economy and they will be big in YVR/416 (and uglier than AB where you have non-recourse residential mortgages).

So Marlene, listen to Garth and stay out of it until you start to hear jingling from the banks’ snail mail.

The way things are going, it certainly looks that way…

#46 Rexx Rock on 02.08.16 at 6:51 pm

$150,000 avg family income in Vancouver.Mom and dad usually kick in at least $200,000 for there kids to buy a house in Vancouver.Rent and retire in a better country that is not so much of a rip off.Buy gold and just short this awesome stock market.

#47 MF on 02.08.16 at 6:53 pm

I understand how Marlene feels. Housing is too overvalued here (in the GTA for me), but investing in equities is difficult to stomach. You can feel hesitant to do anything at all. I took the plunge into equities/bonds last April and have not been rewarded for it. No worries it will go back up, but in the meantime it’s a little painful to see when I peak at my numbers. Her timeline to make “any” money should be 5 years minimum.

It looks like the world markets are going through a correction right now. There is little trust in markets, especially in the central bankers. I am starting to feel the same tbh.

If the central bankers were in control than why are we hearing about negative interest rates? Like Garth wrote a few days ago, this policy is a total admission of failure. Why would Federal Reserve (or BOC/ECB) members even mention negative rates? For those of us who are waiting for a “normalization” and who buy into this recovery talk, this is maddening. It feels like manipulation and wreaks of desperation.

My advice to Marlene is to invest very slowly into a diversified portfolio, adding bits every 4 months or so. This is where I went wrong. I dumped all my money into my portfolio at a bad time (no way to me to tell). I would also talk to a fee based adviser first. Basically B & D ala Garth but with a slow entry point spread over months and even years.

” Besides, the commodity crisis is getting old. There’ll be a significant snapback because (a) the US is still swelling, (b) every week there are more humans yet no more planet and (c) the world still runs on oil and copper, aluminium or grain.”

Garth didn’t mean for this it to be, but I find this comment depressing. We don’t need more humans on this planet and the consumption that comes with it. Whatever happened to the “greying” of Canada anyways?

MF

#48 Canada is a housing ponzi scheme on 02.08.16 at 6:59 pm

Albertans are walking away from their houses now. Canada is in a housing ponzi scheme all backed by the taxpayer. Mortgage fraud is rampant in the GTA and all across Canada And Every mortgage broker and realtor knows it. Useless criminal eaters

#49 45north on 02.08.16 at 7:05 pm

from January 26 2016 post:

The old media’s dying. This pathetic blog’s an example of what comes next, which should scare us all. No editors. No 10-year-old delivery boys. No photogs or compositors. No press guys. No building, newsprint, trucks or drivers.

the old media is dying. I’m commenting on an article written by Andrew Coyne that appeared in the Ottawa Citizen February 2 2016. The Citizen has outsourced its content to “PressReader.com”. It’s quite a trick to copy the article so I can comment on it.

Ontario Premier Kathleen Wynne’s obsession with a new Ontario Retirement Pension Plan is not about ‘helping’ retirees, writes Andrew Coyne, but it’s about financing the premier’s ambitions to build new transit, roads and bridges.

when the adversary was Steven Harper, she proposed that Ontario would have to go it alone to provide pensions for its workers. Coyne goes on to question whether the government should force them to save and whether or not they can save.

Coyne concludes: What, then, explains the premier’s obsession? A line buried in a recent budget perhaps holds a clue. By “encouraging more Ontarians to save through a proposed new Ontario Retirement Pension Plan,” it reads, “new pools of capital would be available for Ontario-based projects such as building roads, bridges and new transit.” It’s not about “helping” retirees: it’s about financing the premier’s infrastructure ambitions. How strange they do not make this point clearer

#50 understood by few on 02.08.16 at 7:05 pm

#26 rk usa on 02.08.16 at 6:25 pm

35 year old making a 120K a year?

seems to be a lot Canadians making six figure salaries in their 30’s

Well six figures isn’t isht anymore. Yeah, it’s above median, but you can’t afford a house on it in Vancouver. Heck, two people making 120K each and it’d still be hard to live the Canuckistan dream in YVR.

#27 james on 02.08.16 at 6:26 pm

but 120k Canadian is 84k USD. In most states, taxes are lower than in Canada and living costs are FAR less. I’m guessing she is around the equivalent of 60k USD here

It’s not comparable like that at all. What about when CAD was $1.05? By your metrics she was doing better, but exchange rate makes no difference if you live in a single country. 120K CAD in Vancouver is like making 120K in SF Bay Area. You get by, but it’s not like you are doing all that well.

Thing is, someone worth 120K in Vancouver (skill-wise) is probably worth a lot more in SF, because Vancouver wages are garbage. Toronto pays more than Vancouver. Why? “The beauty of Vancouver” is part of the benefits package, or some such BS. Take your average YVRer and it’d take a significant wage increase to get them to move east (east meaning anywhere east of the rockies).

#51 Panhead on 02.08.16 at 7:06 pm

Yeah right Garth … like any of us out here in 604land are gonna put in for Marlene’s E-mail addy without seeing a pic of her boat and motor … you think we were born yesterday?

#52 Ronaldo on 02.08.16 at 7:14 pm

#35 Acdel

”Hit the nail on this comment; how can anyone in Canada that makes 120k a year not be able to afford a house? Disgraceful!”

There are many places in Canada that you can easily buy a home if you make $120,000. A 1 hr and 40 minute ferry ride from Horseshoe Bay and you can buy a very nice home for 3X that income. Just not in Vancouver and Toronto and some other bubbly spots. You just have to be prepared to move.

#53 Cici on 02.08.16 at 7:16 pm

#7 Mean Gene

I know someone who did that (and a real smart guy). He was a realtor, in fact. Sold his bloated Victoria special at the top and bought a huge mansion in Hawaii. Lives there half the year, comes back here and rents for the rest. While he’s here he rents out the Hawaiin digs for huge $$ to exclusive clientele; this pays for his rent here with lots left over…

#54 Ronaldo on 02.08.16 at 7:18 pm

#38 Retired Boomer WI on 02.08.16 at 6:42 pm

”Somedays, even the geezer wins!
Old age & treachery will always overcome youth and skill.”

That is unless they do themselves in balancing on a log. Hope you’re having a nice vacation.

#55 Cory on 02.08.16 at 7:20 pm

Even people who work at banks…you know, the ones who figure they’re experts on all things financial just because they work for the bank and you’re just a peasant….are lapping up the “because it’s Vancouver” bull. Meaning houses are worth every penny. I asked her if she thought low rates, easy credit, and the moral hazard called CMHC could be the cause of the ridiculous almost laughable real estate market in Van now? I don’t think she understood any of what I asked. Of course I was the idiot and she recommended a nice GIC to help me through my meltdown.

Sad state of affairs when an industry is allowed to run completely amok at not only the risk to taxpayers and the entire Canadian economy, but at the complete disregard and manipulation of people who really do not understand anything about money (most). All without any repercussions. Front running real estate is just as wrong as it is in equity markets yet it is allowed to exist. Nothing like fanning the flames.

#56 Investorz on 02.08.16 at 7:22 pm

“After The European Bank Bloodbath, Is Canada Next?”

“Nobody actually knows the full exposure of Canadian banks, something which has led Europe’s largest bank to crash 10% today, seen its CDS more than double in the past month, and trade at levels not seen since the Lehman failure”

http://www.zerohedge.com/news/2016-02-08/forget-europe-why-time-has-come-panic-about-canadian-banks-one-chart

– only read ZeroHedge when Canada comes up. You’ll feel famous.

#57 Shawn on 02.08.16 at 7:22 pm

Cheer the market decline.

35 year olds that make $120,000 should definitely cheer the stock market decline.

75 year olds have nothing to cheer about when it comes to stock market declines, but 35 year olds do. Like the chance to take assets from old people on the cheap.

#58 AlbertaShrugged on 02.08.16 at 7:22 pm

I agree with James. 36 puts the age tail end of gen-x, which we know is THE best generation.

No expectations on greatness, and no entitlement like those wimpy millenials. Just cruisin along living within our budgets.

#59 Vanreal on 02.08.16 at 7:27 pm

I don’t believe one single word of this. Single 35 and making 120,000 per annum. Right. If she is real, then she should have bought 5 years ago when she was making 80,000. Lol

#60 Shawn on 02.08.16 at 7:27 pm

Albertans are Walking away from their Houses?

It MUST be true because just yesterday there was a story in the news about a credit counsellor who had exactly ONE client who did that.

Meanwhile it would be news to the folks at the Canadian Bankers Association where the 90 day default rate has not budged yet and remains under 0.30%.

In Alberta you can get away with walking away from a mortgage but ONLY if you had no CMHC insurance. Now how many people with more than 20% down will be walking away?

Doomers are so comical. They mistake half baked and wildly exaggerated opinions for fact.

#61 acdel on 02.08.16 at 7:39 pm

Looks like West Coasters are taking a stand; albeit a minority, but who’s to say where it leads!

http://news.nationalpost.com/news/canada/protesters-rally-against-demolition-of-6m-vancouver-mansion-built-in-1996-that-just-got-350k-in-renos

#62 Mark on 02.08.16 at 7:39 pm

“If housing crashes, won’t markets similarly crash? “

Nope. Because most of the stuff, at least in the TSX, is rather inversely correlated with housing. And will benefit by having the speculators’ attention turned towards them instead of towards housing as an asset class.

The experience in the 1990s real estate crash was that a mere 25% downpayment, invested at the beginning of the 1990s, including dividends, grew enough to buy a similar house, outright, by the end of the decade. People who eschewed buying at the peak of the late 1980s bubble, and stuck it into an efficient and balanced portfolio of stocks, did incredibly well.

Intuitively this makes sense. The deflation that is caused by falling housing prices will force the BoC into very stimulative monetary policy for a considerable period going forward. There are very few TSX-listed companies in the business of housing supply (most are privately or foreign-held). And some TSX sectors have significant upside in an environment of monetary instability which appears to be increasingly a global theme on a much grander scale than just the Asian crisis of the mid 1990s. One such sector is breaking out like crazy right now.

#63 Retired Boomer WI on 02.08.16 at 7:39 pm

Don’t ya just love it when the daily settlements are in, the parked tanked 177 points and your balance is up by 9 grand?

Buy low they said… yeah, when it was off by nearly 400…

#64 Soothsayer on 02.08.16 at 7:41 pm

Luxury housing market in Alberta has crashed. CBC reported today people walking away!

I doubt oil is where it is because your masters said that’s what it should be. It was a conspiracy to bring it up to $150 and that was a fact that leaked 1.5 years before. Open market….blah blah blah

#65 Mark on 02.08.16 at 7:43 pm

“In Alberta you can get away with walking away from a mortgage but ONLY if you had no CMHC insurance. Now how many people with more than 20% down will be walking away? “

I believe loans from Bank Act institutions (ie: the big-5) are also excluded from that non-recourse provisions. So basically the only true non-recourse loans in Alberta are those issued by provincially regulated entities, and for which further CMHC insurance hasn’t been taken out.

In other words, the non-recourse provisions in Alberta are so limited in scope that they’re almost not worth talking about. Similar to the non-recourse provisions in certain parts of the USA, which were also highly restrictive and applied to almost no loans (as practically everyone at risk of default had refinanced a time or two in their bubble, and refinancing voided the non-recourse-ness!).

#66 Rational Optimist on 02.08.16 at 7:45 pm

A 35-year-old is not a millennial. I’m not saying she’s old, or over-the-hill, or making any comments on where her biological clock may be at. Those are all highly variable based on the person. But she can’t change the fact that she was born in 1980, and is Gen X.

#67 I'm stupid on 02.08.16 at 7:48 pm

A realtor friend of mine hired someone to pretend to be a buyer at one of his listings so he could have a multiple offer situation and get more money. The guy used an unsuspecting agent as well. I think the homeowner was in on it too. It’s called salesmanship. Lol

#68 wade on 02.08.16 at 7:59 pm

A while back you guys posted a link to u tube where Chinese realtors were doing a similar tactic. They would bring in foreigners to prance on stage for a fashion show and give them fancy titles. …the Chinese were told they lived in they lived in the complex….this gave it a more cosmopolitan feel and thus more desirable….would have been a good idea to post that link again…..thanx for your weblog, knowledge is power

#69 Mike in Toronto on 02.08.16 at 8:00 pm

#53 Vanreal

5 years ago I was making $75k, today I’m making $170k. My girlfriend earns another $80k. The secret to earning more seems to be quitting.

I can’t believe it either. Neither of us can make sense of this. The money we earn is useless. We had everything we had today when we had a third the income. We can’t upgrade from our $1200/mo apartment, and even though we’re packing away some $100k/year in savings, housing prices are increasing much faster than that.

Sure we can pay double for something smaller with granite, en-suite and a nice laundry… with no protection from the landlord, or we can trade $350k in savings for a $500k debt… but all it gets us is a less convenient place to live, snow to shovel and a spare room.

I’m better off renting a private office in a coworking space somewhere cool and a workshop in a makerspace.

A friend of the GF’s bought a $500k 1br condo. All she sees from the window all day is cars. Gardiner, Parliament, etc. Snazzy building, but full of obnoxious kids partying and a line of Realtor(tm) lockboxes stuck to a rod outside.

Our money is better spent in Cuba or Portugal. Let the condo owners and homeowners tell us one more time “buy now or buy never” while they worry away their lives.

Toronto’s gotten very weird.

#70 conan on 02.08.16 at 8:01 pm

Japan markets currently laying eggs. Down 4 percent in sympathy with the European chicken coop.

Could be an omelet on North American markets tomorrow.

#71 Dale Stacks on 02.08.16 at 8:03 pm

Canadian banks and financials would probably be down another 10% to 12%. The TSX will be 10,800 to 11,000 by end of February-2016.

#72 Mark on 02.08.16 at 8:06 pm

“But she can’t change the fact that she was born in 1980, and is Gen X.”

1980 isn’t really Gen X either. Gen X’s had a shot at the vibrant employment market of the late 1990s. The Millennials have only seen stagnation. Someone who makes $120k today, probably didn’t graduate college till at least 2002-2003, and thus, hasn’t seen the upside of a vibrant employment market for professionals (outside of the healthcare sector, of course).

To lump people born in 1980 in with people born in the mid 1960s doesn’t make a lot of sense to me either. So treating her as a Millennial seems reasonable. Although admittedely, the 1977-1982 – crowd, for which I believe birthrates were relatively suppressed, doesn’t have really good representation in public discourse.

#73 Freeman on 02.08.16 at 8:12 pm

Back in the dark days of 2008 I was advising that the U.S. Government turn the local post office branches into government funded ‘Banks’, similar to the government owned ‘Bank of North Dakota’

https://tinyurl.com/cfbem4

That way people will have a place to cash their cheques when the private banking system collapses, and employers can borrow money from the federal bank branches when the private banks totally collapse.

Well, the shit must be getting pretty close to hitting the fan right now because that is EXACTLY what congress is now doing:

“SHOCK BILL: US POSTAL SERVICE TURNED INTO A FEDERAL BANK”

https://www.youtube.com/watch?v=VMngY6SyZvY

“Bernie Sanders’s Highly Sensible Plan to Turn Post Offices Into Banks”

https://tinyurl.com/p38lkcg

#74 Big Dipper on 02.08.16 at 8:21 pm

#242 IHCTD9 on 02.08.16 at 3:59 pm

#236 Big Dipper on 02.08.16 at 2:39 pm

How did a craven socialist become so sensible? Are you feeling okay? — Garth
____________________________________

I have noticed as well – I think I’ve largely agreed with everything BD has posted in the last week!

If this keeps up, Herb and I will begin agreeing that both Harper and Trudeau are great!

————————————————–

Never judge a book by its cover. I know enough about the system to long ago come to the realization that the uncontrolled market, i.e. the much admired, “Laissez Faire” capitalism, is a complete and dangerous disaster. Uncontrolled markets will harm society. That’s why regulatory bodies are always formed in reaction to the ridiculous and often criminal excesses of the so called “free” market.

Capitalism only works of it’s thoroughly regulated and taxed. The outrageous house market in Vancouver is a good example of an uncontrolled market running amok. The end result will ruin innocent bystanders, and the leftover mess will take years to fix – usually with tax payers support. Supporters of uncontrolled markets will whine about too much government intervention. They always do. The process of cause and effect is lost on them.

Happy now?

#75 Frank on 02.08.16 at 8:21 pm

Speaking of safe havens, I updated my Millionaire Metric chart: http://www.chpc.biz/millionaire-metric.html

My god, this is like a window into the mind of a mad man. Your data and assertions are like stream of consciousness ramblings, there’s no filter. You need to zero in on key pieces of data, these charts full of lines are barely readable.

#76 What the world needs now… on 02.08.16 at 8:23 pm

#38 Retired Boomer
“Interesting ride on the street of WALL today. Got to buy four wonderful dividend payers at or even below my “buy” price. How did that happen you say? Well, this morning looked at orders. Two were getting close to my strike price so cancelled the orders. Checked a bit later they were below with no new adverse news to worry about, so I bought them.”

so you ‘know’ that’s the bottom, eh….you’re
pretty prescient….enjoy your steak, I just might see some cat food in your future….

#77 Caught In The Grip on 02.08.16 at 8:24 pm

We’re in a global equity bear market. This will likely be worse than 2011. It will be the catalyst that brings down the Canadian housing market. $CAD will likely continue to follow the price of oil in the short term (which may or may not have bottomed) but will eventually detach from oil and fall further due to continued divergence between the Canadian and US economy. I think we will see all time record lows for $CAD in the coming years.

#78 Freedom First on 02.08.16 at 8:38 pm

I feel sorry for people like this. Too bad they’re not like me with all their ducks in a row. My money worries are over and I’m the best. I put myself first. Freedom First.

#79 pinstripe on 02.08.16 at 8:39 pm

an example how the cons look after the taxpayer dollars.

http://www.cbc.ca/news/canada/saskatchewan/brad-wall-seeks-156-million-for-oil-patch-cleanup-program-1.3438670

#80 Nagraj on 02.08.16 at 8:52 pm

Dear Marlene,
Why in the world would you seek advice from an old geezer with impeccable cons credentials? Who lives peaceably with his wife and beloved dog in a quiet suburb far from any gay strip joints. And looks to be the sort who goes to St. James (Anglican) infrequently (as is quite proper for Anglicans, actually). What would he know?

Take it from me, that here’s your only course of action, Marlene:
– change your stupid dull name
– sell everything and quit your dumb job
– learn the basics of Arabic
– take belly dancing lessons
– move to Abu Dhabi

Your friend, Nagraj

#81 pinstripe on 02.08.16 at 8:52 pm

an example how land purchase deals are done in Sask.

http://www.cbc.ca/news/canada/saskatchewan/regina-timeline-land-transactions-bill-boyd-1.3434291

#82 Joe on 02.08.16 at 8:53 pm

DELETED (anti-Chinese)

#83 4 AM Sunrise on 02.08.16 at 8:54 pm

Disclaimer: one story does not a trend make. With that out of the way, I quote for you word-for-word an e-mail from a family friend:

“I bought a house quickly during my stay in Vancouver, only one time looked at the house, I made an offer then came back to Beijing. I will get the key at the end of Dec. ( my agent will get the key for me)”

I don’t know if the house is in Vancouver proper.

Then, in a subsequent e-mail:

“Yes, the house in Vancouver and Toronto are all soaring. I bought other one in North of Toronto, it’s a townhouse where is near a lake, the view is beautiful.”

Not sure if this is one of those pressed cornflake jobs I read about on this blog. I also don’t know my geography well enough to pinpoint which lake she’s talking about.

Source of funds: sale of property(ies) in China where the market has soared fivefold. I don’t know what she does for work. I only know that it’s not 9-to-5. I accidentally came across an e-mail she sent to somebody in India about freshwater pearls…sounds like she’s an intermediary or something. Unless “pearls” is code for something else. I don’t know.

#84 acdel on 02.08.16 at 9:03 pm

#51 Ronaldo
#35 Acdel

”Hit the nail on this comment; how can anyone in Canada that makes 120k a year not be able to afford a house? Disgraceful!”

There are many places in Canada that you can easily buy a home if you make $120,000. A 1 hr and 40 minute ferry ride from Horseshoe Bay and you can buy a very nice home for 3X that income. Just not in Vancouver and Toronto and some other bubbly spots. You just have to be prepared to move.
===================================
I completely agree, but it is too bad that one has to in this vast country of ours. Ces’t las vie!

#85 Nicolas on 02.08.16 at 9:07 pm

Marlene,

Your market question is as old as money itself. Here’s my favorite Warren Buffett quote on this.

“A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves.

But now for the final exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period?

Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall. In effect, they rejoice because prices have risen for the “hamburgers” they will soon be buying.

This reaction makes no sense. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.”

#86 common sense on 02.08.16 at 9:07 pm

I wonder if Japan wishes it had not gone to NIRP.

Stocks down 25%!!!! Since…..

#87 Bob Baker on 02.08.16 at 9:10 pm

Garth, I disagree on a couple of points. First, this si no time to be ‘investing in the market sale’, This is a time when old traders will say “Don’t reach out and catch a falling knife”. There are way more net shorts outstanding, meaning that the really smart people with access to all the unvarnished data know that there is a lot of down left in the market before any up appears.

The EU is in freefall, social unrest is growing at a rate not seen since the 16th century, it will get worse as the governments have decided to deport a million Musilms. Besides that , earnings globally are in the tank, so PE’s mean nothing if they are deteriorating on slowing growth. They’re cheap for a reason.

The unemployment ‘bounce’ in the US and supporting rate rise is looking ever more clearly the political manipulations of the Obama administration. The McJobs jobs market data is based more on people who’ve stopped looking for work and don’t qualify for EI. Welfare numbers and social assistance cheques aren’t counted as unemployed, and the Obama Ad min doesn’t report the U6 numbers. Ditto, earnings are in the tank.

You can’t trust the unaudited Chinese numbers. They play their own game and don’t give a crap about the west. So far, everything they ‘ve reported has been bunk. The manipulation of the market is beyond criminal.

We don’t have to talk about how our little Canada is imploding in upon itself. Government chasing business out of the country with more politically correct restrictions and higher taxes. Thats what you voted for, so who am I to argue?

Nope, I’m voting with my wallet and staying in cash until this all clears away. I have already left Canada and no longer have to cry whenever the government steals half my pay and adds the insult of ‘EI and CPP’ on top of that. I live in a flat tax 15% country that’s booming and the sun shines every day. I hate to report this but ex pats are in high demand in Asia, the jobs pay international salaries not the low pay standards of Vancouver or Toronto.

“Catch a falling knife”, not my style.

Reality in Canada is what we see going on in the auction and bankruptcy businesses where families are selling the clothes off their backs just to put food on the table.

Get out while you can, and preserve your capital for the darker days ahead.

http://business.financialpost.com/news/economy/signs-of-distress-in-markets-gather-force-as-fears-over-the-global-economy-deepen

#88 Herb on 02.08.16 at 9:12 pm

For those interested in what real estate professionals should and should not do, here is the Code of Ethics issued by the Province of Ontario as Regulation 580/05 under the Real Estate and Business Brokers Act, 2002. (A link to the Act itself is under the heading.)

https://www.ontario.ca/laws/regulation/050580#BK3

Other provinces will have similar acts and regulations.

#89 Metaxa on 02.08.16 at 9:30 pm

My daddy got himself to a place where all the stuff you all are so consumed with bored him so he got into racehorses, boxers, land assembly and actual gold mines.

The folks he played with on that were primarily from the US.

That group goes on today with sons/daughters replacing fathers and the very few mothers as death takes its toll.
Pretty tight group, we all help one another along. Sometimes buying into a play, sometimes with just advice or maybe an introduction.

Anyway, I’ve been talking with these guys for 30 years, phone, fax and now Internet and can tell you that anyone who tells you that taxes are lower in the US is lying.

Sure, the marginal Federal and State rate might be a bit less than ours up here tho how you can compare our Federal and say Manitoba with their Federal and New Jersey is beyond me.

My house and property is property taxed at $2,000.
A very similar sized house in square feet but with one more bedroom in New Jersey is taxed at over $14,000.
never mind that fees, licenses, local levies invariably are higher in the US than here…at least any place you might want to live.

I don’t live in the sticks either…we have Costco AND Home Depot so granite sinks and a storage locker for the toilet paper. Just like you big city guys.

Just without the Xanax, Metamucil and therapy bills.

My Daddy told me one more thing, its better to be well off than to appear well off.
Some of us need to keep that in mind.

Dumping on the country that brought you to where you are now and exhibiting the kind of simmering hate/disgust/dislike for both this country and those seeking answers, asking questions is the wrong way to go in my books.

#90 common sense on 02.08.16 at 9:35 pm

#86 Bob Baker

Very well said….could not agree any more.

May we ask what country your residing in?

#91 Briana on 02.08.16 at 9:35 pm

Sell all market holdings and buy everything much lower…..Markets are going to drop much further. Do not buy real estate, both Vancouver and Toronto markets will suffer major correction. Invest in collectibles, wine, art, rare jewellery, comic books, etc.

#92 YVR feeding frenzy on 02.08.16 at 9:40 pm

Housing in Vancouvers lower mainland is on fire. Prices going up $1000 per day.

Locals and future immigrants have realized that gov will keep rates low AND increase immigration for the foreseeable future.

I’m calling it. You will not find a detached home in the lower mainland for less than $1 million within 5 years time.

It’s a self fulfilling prophecy now. The haves will have RE and the have nots will be exposed to rent price increases for generations.

#93 MF on 02.08.16 at 9:50 pm

#86 Bob Baker on 02.08.16 at 9:10 pm

I actually agree with this. You basically said what I did in my post above, but much more eloquently.

The ex pat thing is so attractive to me but to be honest, I don’t have the balls (or the skills) to just get up and go to Asia. I wish. First choice would be the Phils, or Thailand.

I’m assuming your in Thailand? We’ve had a few posters on here as of late gloating about their lives in Thailand. I showed my filipina girlfriend one of the posts. She laughed and said people here take the stability of Canada for granted. That’s what Canada’s allure is. I think many of us Canadians (me included) often forget about the stability we enjoy, are cynical, and are used to complaining about not making loads of money.

The lower taxes in these other countries come at a price.

MF

#94 acdel on 02.08.16 at 9:53 pm

#86 Bob Baker
#89 common sense

As common sense asked; please do tell!
I still feel good about investing Canada in the long run (resources,etc, perhaps delusional) but I absolutely do not believe the numbers the the U.S. and Chinese are providing us. The U.S. can continue to print but at what point does it blow up?

#95 have fun on 02.08.16 at 9:58 pm

“The global economy is still expanding, not contracting.” -Garth

What a bunch of baloney. Japan going to negative interest rates because the economy is GREAT? Most of Europe in negative rate environment, and ECB will pump more and print more? US Economy and jobs losing steam, and we know about Canada. China slowing to a crawl…

Stock markets collapsing, Bond yields disappearing to nothingness and precious metals starting to skyrocket.

Actually the global economy is growing, not contracting. You might try research as a way of diminishing embarrassment. — Garth

#96 espressobob on 02.08.16 at 10:02 pm

#75 What the world needs now…

Loading up near the bottom is something that experienced investors do well. Sometimes the young don’t listen! Why would they?

#97 Ronaldo on 02.08.16 at 10:08 pm

Interesting article and charts from the Globe and Mail regarding historical housing prices in Van and To.

http://www.theglobeandmail.com/report-on-business/economy/housing/toronto-and-vancouvers-lofty-home-prices-put-into-historical-context/article27316493/

#98 Shine on You Crazy Diamond on 02.08.16 at 10:12 pm

# 91 – you are either a realtor or are somehow unaware that every real estate market in the world has a cycle – nothing can go up forever – what goes up always comes down.

Prices are determined by what someone is willing to pay – whether for renting or buying their home. Simple economics – prices follow the law of supply and demand.

Vancouver has been a Boom and Bust market since it was first founded. Educate yourself – reality bites when it is least expected.

#99 GenX on 02.08.16 at 10:19 pm

RRSPs and TFSAs are fine for as long as the money in the Canadian bank is safe -> http://www.zerohedge.com/news/2016-02-08/forget-europe-why-time-has-come-panic-about-canadian-banks-one-chart

It seems to me we’re moving towards a storm in which classical financial laws will be turned upside down.

Is it possible to have RRSPs and TFSA outside Canadian banking system?

Silly, misinformed comments. No Canadian bank will fail, falter nor stumble. — Garth

#100 No Canada, No on 02.08.16 at 10:22 pm

>>> Markets are unhappy with slowing global growth, the slide in commodity values, the nutjob running North Korea, uncertainty over the Chinese economy, the course of US interest rates and, in Canada, record debt, oilageddon and house lust

The markets don’t give a f. Remember those funny headlines about Greece leaving Euro, or busting euro or stopping olive shipments or something like that? Or “ebola omg we gonna all die” so called panic? Or disintegrating Europe?

Markets don’t care. The only reason they are exploding right now is because they were exploding higher a year ago. Reverting to the mean.

#101 Smoking Man on 02.08.16 at 10:38 pm

Being a writer is exhausting.

Chapter 7 Done !!!!! Woo Hoo

Feels like I’ve been away for a decade, did the polar caps melt, have the oceans eaten New Orleans yet. Are commies still running Canada. Has Big Dipper matured and come to the Right Side.

And the world gets stranger by the second.

http://www.washingtontimes.com/news/2016/feb/7/pentagon-orders-commanders-to-prioritize-climate-c/

#102 Millmech on 02.08.16 at 10:41 pm

Marlene
Invest 30% of your gross income in a Garth style portfolio every payday,rebalance quarterly.You will be doing the two smartest things for financial success,paying yourself first and living under your means.
This money is for retirement only and in twenty years you should have an income of $160,000 for the next 20-30 yrs not including work or govt pensions.
The rest of your money is for rent/purchase,living travelling or whatever you want
Finally don’t pay any attention to the markets,just keep socking the cash away,that’s what the rich do

#103 Weedeater on 02.08.16 at 10:44 pm

Marlene you haven’t lost anything unless you crystalize your losses by selling. Unless you’re consciously rebalancing there’s no reason to sell. This is the time to buy when people are freaking at declining markets. I’m guessing the tsx will drop further before things turn around. Hang in there. The last time this happened in 2009 the markets came roaring back. Most recessions last about 18 months.

#104 Capt. Obvious on 02.08.16 at 10:51 pm

Most annoying aspect of today’s post is that you can make $120k a year and be a total effing idiot, apparently.

35 year old making a 120K a year?

seems to be a lot Canadians making six figure salaries in their 30’s

Not really, not if you look at income statistics. Are some? Sure. Also, $120k today is like $75k in 1990. Ain’t inflation beautiful.

#105 GenXer on 02.08.16 at 10:56 pm

#73 Big Dipper on 02.08.16 at 8:21 pm

There’s the Dipper I know and love!

#106 BK on 02.08.16 at 10:57 pm

You guys are missing the point. 35 yrs old…Millennial or Genx?? Who cares! What needs to be addressed is generation screwed just got larger.

#107 RimJabba on 02.08.16 at 11:00 pm

http://www.cbc.ca/news/canada/calgary/jingle-mail-alberta-housing-1.3430867

Jingle mail is back!
Alberta first, Canada next!

#108 understood by few on 02.08.16 at 11:04 pm

#58 Vanreal

Sounds entirely believable to me. How many single people in that age range buy detached homes? I know one in YYJ. Everyone else I know that owns a SFH is married. The rest of the singles “own” condos. All people in their 30s. Of course that’s just an anecdote, but I’m sure we can all agree 120K isn’t enough to buy a SFH in YVR. It’s workable in YYJ, but a 120K job in Vancouver only pays 90K in Victoria. That’s still enough to squeak by on buying a little rancher in Victoria, but it’s a bit of a stretch. You need to be able to save and invest still (though some people believe buying is both saving and investing…).

#109 Bram on 02.08.16 at 11:04 pm

#96 Ronaldo on 02.08.16 at 10:08 pm
http://www.theglobeandmail.com/report-on-business/economy/housing/toronto-and-vancouvers-lofty-home-prices-put-into-historical-context/article27316493/

That’s an interesting graph indeed: the one that shows the ratio between YVR and the rest of Canada.

According to that graph, the bubble is not YVR specific. It is just more pronounced due to the higher absolute values.

I would not have guessed this to be the case.
The media tends to speak of the two different housing markets: yvr/toronto vs the rest.
And lately, even yvr vs the rest of the nation.
But the multiplier seems reasonably stable. It’s gone up, but far from ballistic.

Bram

#110 Ponzius Pilatus on 02.08.16 at 11:04 pm

Yellow helicopters are again hovering over the Lower Mainland.
Last time it was White Rock.
Now it’s Ladner.
I buy two, my sister buy two.

#111 cramar on 02.08.16 at 11:15 pm

#51 Ronaldo on 02.08.16 at 7:14 pm
#35 Acdel

”Hit the nail on this comment; how can anyone in Canada that makes 120k a year not be able to afford a house? Disgraceful!”

There are many places in Canada that you can easily buy a home if you make $120,000. A 1 hr and 40 minute ferry ride from Horseshoe Bay and you can buy a very nice home for 3X that income. Just not in Vancouver and Toronto and some other bubbly spots. You just have to be prepared to move.

————–

There are places in Canada where you can BUY a house for $120,000!

#112 wtf on 02.08.16 at 11:18 pm

Garth, you are missing the big question – your blog name?

Who is the Greaterfool at the end of these assignments?????? For assignments to work and people to take risk to stand in between deals, someone at the end has to buy this crap at inflated prices? Who are these people? How do they pay? Do they intend to live in the house? How did they earn that money?

These questions are at the core what people are asking as they walk around Vancouver and Toronto

Calgary is now facing people walking away from homes, it reflects jobs and economy. Nobody is surprised.

However since Toronto and Vancouver are adding jobs with ok size populations, the game continues…how high, nobody knows..but this is what people cannot connect. It took only a small article in the globe to bring on a tipping point. Listen to the people’s voices, you might here something smart…

#113 Leo Trollstoy on 02.08.16 at 11:22 pm

There are places in Canada where you can BUY a house for $120,000!

whats the median household income in those places?

#114 ROCK BEATS PAPER on 02.08.16 at 11:25 pm

The comments on this blog today definitely indicate a short term bottom. I will be buying Stocks tomorrow.

#115 pwn3d on 02.08.16 at 11:31 pm

#91 YVR feeding frenzy on 02.08.16 at 9:40 pm
Housing in Vancouvers lower mainland is on fire. Prices going up $1000 per day.
————————–
YYZ is also en fuego. Feb is only a week old but some of the sold prices are insane. the 905 is nuts right now.

#116 acdel on 02.08.16 at 11:37 pm

#110 cramar
#51 Ronaldo on 02.08.16 at 7:14 pm
#35 Acdel

”Hit the nail on this comment; how can anyone in Canada that makes 120k a year not be able to afford a house? Disgraceful!”

There are many places in Canada that you can easily buy a home if you make $120,000. A 1 hr and 40 minute ferry ride from Horseshoe Bay and you can buy a very nice home for 3X that income. Just not in Vancouver and Toronto and some other bubbly spots. You just have to be prepared to move.

————–

There are places in Canada where you can BUY a house for $120,000!
—————————————————————–
Absolutely, and lower in many areas, my apologies, I meant to say the Vancouver area! Have a goodnight dawgs!

#117 WUL on 02.08.16 at 11:38 pm

What the hell has this blog done to this lifelong Albertan (newly minted 60 year old)? I used to while away my hours considering the relative merits of the .338 Win Mag and Nosler Partitions. That was coupled with scouting hot spots in the Whitetail buck belt

Now I read about mania in Vancouver.

Thanks Turner!!!

#118 SickofBC on 02.08.16 at 11:38 pm

B.C. to investigate profiteering by Vancouver realtors
Very interesting

http://www.theglobeandmail.com/news/british-columbia/bc-to-examine-real-estate-industry-watchdog/article28661774/

#119 Ronaldo on 02.08.16 at 11:50 pm

#110 cramar on 02.08.16 at 11:15 pm

”There are places in Canada where you can BUY a house for $120,000!”

Absolutely. Here’s an example right here. You could live in the shack and build your dream home at your leisure.

http://remax-lillooet.com/listings/index.php?action=listingview&listingID=745

#120 Ronaldo on 02.09.16 at 12:09 am

B.C. to investigate profiteering by Vancouver real estate agents. About time. And thanks to Garth as well for being part of this push for accountability. There is no doubt in my mind from what I personally have observed and what has taken place before in Vancouver going back many years that flippers and speculators are the root cause of this insanity with prices. I fully expect that this thing is going to start unwinding in the next few months.

http://www.theglobeandmail.com/news/british-columbia/bc-to-examine-real-estate-industry-watchdog/article28661774/

#121 macroman on 02.09.16 at 12:24 am

Garth, you are confusing US swelling with hemorrhaging.

Better read the fine print on the bottle of blue pills.

#122 The dilemma - Realties.ca on 02.09.16 at 12:34 am

[…] Source: http://www.greaterfool.ca/2016/02/08/the-dilemma-4/ […]

#123 understood by few on 02.09.16 at 12:37 am

#51 Ronaldo

“A 1 hr and 40 minute ferry ride from Horseshoe Bay …”

Nanaimo?! There’s a reason houses are cheap in Nanaimo.

#124 macroman on 02.09.16 at 12:46 am

Last!

#125 S.Bby on 02.09.16 at 12:53 am

#109 Ponzius
Not many here will know what you are referring to, but I do.
I buy three my husbah gonna buy three…

https://www.youtube.com/watch?v=lKevSXL_104&feature=youtu.be

#126 Joe2.0 on 02.09.16 at 1:00 am

The Global economy is growing?
Then why has the Baltic Dry Index crashed?

#127 jane 24 on 02.09.16 at 1:47 am

Marlene your problems truly are first world problems not real problems at all. You have a good job, your health, family and friends – you have it all but may not realise it. Enjoy every day but don’t leave it too late to have your own family. This is what truly counts in life.

You have another 30 years of investing in front of you and believe me at some point in those 30 years the market will indeed come back!!

Re Marlene’s salary of $120,000 Cdn that is £60,000 here in England and about average money for a mid-30’s professional. If I think of the 30 to 37 year olds in my family that is about right. Some of them have their own little businesses, others are professionally qualified.

I do know though that salaries are lower and the cost of living higher in Canada and suspect the reason Canadians are not rioting on the streets is that so few have been anywhere else in the world to check things out.

Re the posts on Abu Dhabi, been there to work and I never felt safer or was better paid in my life. Easy way to get house deposit.

#128 triplenet on 02.09.16 at 1:54 am

I’m a little baffled by the fact Marlene has been reading this blog daily for the past two years….what’s with the questions?
You can’t count your money and read at the same time.
See, problem solved. That was easy.

#129 Freedom First on 02.09.16 at 1:59 am

Garth is allowing Freedom First impersonators to mock me. I am not impressed.

#130 PPT on 02.09.16 at 2:24 am

The Plunge Protection Team was given a massive assignment yesterday to keep the DOW above 16,000 and SP above 1850.

The Twitterverse and the major US financial sites are abuzz with how the PPT is openly rigging the markets in the last hour of trading when there is absolutely no news for the turnaround.

The markets are rigged. Show me the data that they aren’t!

#131 Ronaldo on 02.09.16 at 2:50 am

On a recent trip to Vancr. to visit family who live in the Mt. Pleasant area, I decided to take a wander around the area bounded by Cambie and Main and 18th to 23rd just to see what was happening. This represents an area 24 square blocks in size.

1. 18th. Avenue – nothing for sale. 1 house on corner of 18th and Ontario appears to be getting ready for a tear down. The place sold Dec. 2/14 for 1.8 million. It’s a large lot. 2015 assessed at 2,058,400 (bldg. 8400).

2. 19th. Avenue – nothing for sale. 1 house has been torn down and new build in progress. Original house was assessed at 1,752,800 (bldg. 12,800).

3. 20th. Avenue – nothing for sale. New home near completed in place of tear down. Original assessment 1,802,000 (bldg. 132,000).

4. 21st. Avenue – 2 houses sold and 1 for sale.
1st. house sold for 1,998,000, assessed 1,711,400, previous 1,385,100.

2nd. house sold for 2,198,000, assessed 1,939,000, previous 1,565,000.

3rd house for sale for 2,299,000, assessed 1,860,000, prev. 1,569,000.

5. 22nd. Ave. – 1 house for sale for 2,399,000. Assessed 2,062,000, prev. 1,762,000.

1 new build. Assessed 2,686,000, prev. 1,515,300.
Original house sold for 1,250,000 in Oct. 2013.

1 tear down, new foundations in place. Orig. assessed at 1,663,500 (bldg. 9500).

1 appears to be readying for tear down. Assessed at 1,728,000, prev. 1,412,000.

6. 23rd. Avenue – 1 vacant lot (tear down). Sold for 1,786,000 March 2015, orig. asking was 1,698,000. Assessed at 1,858,000 (bldg. 52,500).

Gives you an idea of what is happening in that area. There appears to have been many more tear downs in the last few years. It is obvious that the tear downs and the rebuilds are what is contributing to the increased values of these properties. Prices for lots are nearing the 2 million dollar mark for 33 x 122 ft. lots.
One has to wonder how this can possibly continue.

#132 nubbers on 02.09.16 at 4:23 am

To Marlene, Frank and any other singles feeling priced out of the housing market.

It could be so much worse. You could be stuck with a partner who hates your guts because you refuse to lie about your income to buy a house you can’t afford and which would commit you to a life of debt slavery even without a rise in interest rates.

The best thing is to (make an effort) to enjoy your life and your freedom. There will be time to pick up a bargain later.

#133 Bob Baker on 02.09.16 at 4:29 am

“common sense on 02.08.16 at 9:35 pm

#86 Bob Baker

Very well said….could not agree any more.

May we ask what country your residing in?”

I have joined the flood of ex pats who’ve been recruited to work in Thailand. It’s booming here. Industries of all kinds are experiencing explosive growth.

Most of the expats we meet are from the UK and EU. Caucasians for some reason, salaries and benefits aren’t as high across the board. A Philipino registered nurse with 10 years exp can be had for about a grand a month, less than a teacher with a Canadian or UK credential in a private school.

It’s all about a market, and we Caucasoid types with expertise are considered highly prized and valued highly in this market, unlike in Canada where white folks are on the no-hire list.

MF #92

“I actually agree with this. You basically said what I did in my post above, but much more eloquently.

The ex pat thing is so attractive to me but to be honest, I don’t have the balls (or the skills) to just get up and go to Asia. I wish. First choice would be the Phils, or Thailand.

I’m assuming your in Thailand? We’ve had a few posters on here as of late gloating about their lives in Thailand. I showed my filipina girlfriend one of the posts. She laughed and said people here take the stability of Canada for granted. That’s what Canada’s allure is. I think many of us Canadians (me included) often forget about the stability we enjoy, are cynical, and are used to complaining about not making loads of money.

The lower taxes in these other countries come at a price. ”

****The Phils is still quite backward and no way on par with Thailand in any way. The jobs aren’t there. The money isn’t there because the international companies do not locate there. Thailand and Singapore are the choices for business. The infrastructure is here. Makes Canada look like a third world country by comparison.

Global administrative businesses are not locating to Canada for a reason, overhead is out of control. Here, they can pay the managers huge money for productivity expansion, that’s where the big international salaries for ex pats comes in.

But what you said about moving is typical of most Canadians, we have as a nation little appetite for mobility, you see few Canadians working overseas aside from mining engineers. The stability of Canada is abused by governments union backers to enslave the population with taxation.

Get out of the ‘Canada Mentality’ and your income goes way up. I spent 5 years in the US before coming here and earned double what my profession pays on average in Vancouver.

And did I mention that the sun shines every day?

#134 You must be young #59 Shawn on 02.09.16 at 5:00 am

Not comical in early 80s AB. I did it with over 20% down vested. And so did many of my friends in the same situation.

Google “Canadian House Prices Index Base 1980 = 100” and look at Calgary and Edmonton data.

How do you think that price index happened?

Just the CMHC mortgage holders bailing which is typically 60% of the market, the rest being the 20% down or more crowd?

When you lose your job, you get rid of large expenses such as a mortgage especially when you can do it with impunity.

Not so laughable or doom and gloom after all?

And back then, we were not as leveraged to the gills as they are in YVR/416 today. My then house to income ratio was < 2.

YVR currently stands at 11 and 416 at 8.

Add to that current economy and job losses to follow…well, it is just a matter of time isn't it?

#135 Ace Goodheart on 02.09.16 at 6:45 am

Marlene needs to learn the difference between price and value.

Price is what something’s being sold for.

Value is considering whether you’d want to hold onto the item, at the price paid with any debt which you took on to buy it, for 15 years, with no market to sell it in.

If you wouldn’t, then you shouldn’t buy it.

#136 LP on 02.09.16 at 7:19 am

#88 Metaxa on 02.08.16 at 9:30 pm

Dumping on the country that brought you to where you are now and exhibiting the kind of simmering hate/disgust/dislike for both this country and those seeking answers, asking questions is the wrong way to go in my books.
*************************************

Thanks for that comment…sums up my feelings exactly. I’m so sick of the whiners who think that because they aren’t as rich as they feel they deserve to be, or who think that being well off they needn’t pay their fair share of taxes, all announce they’re “outta here” on the first available boat or plane or train.

“Good riddance”, I say!

#137 Clochard Kuujjuaq vs Wall Street on 02.09.16 at 8:03 am

Marlene dear, be cool and you may escape unscathed!

http://www.20min.ch/images/content/1/4/8/14825075/17/teaserbreit.jpg

#138 Smoking Man on 02.09.16 at 8:06 am

There is a reason I call them tree huggers.

Complete waste of tax payer money. But some cronies get rich.

http://business.financialpost.com/news/agriculture/why-ontario-is-struggling-to-find-homes-for-50-million-trees

#139 jess on 02.09.16 at 8:16 am

47 Canada is a housing ponzi scheme on 02.08.16 at 6:59

Quicken Loans’ Super Bowl ad sparks backlash

false appraisals?
http://mfi-miami.com/2015/02/quicken-loans-contribute-to-blight/

The complaint says Quicken’s employee rules violate the National Labor Relations Act. Established in 1935, the law grants workers the right to discuss pay and other workplace policies for the purpose of collective bargaining. Rather than seeking monetary damages, the NLRB wants the company to rewrite its handbook.
http://www.csmonitor.com/Business/2015/0928/Quicken-Loans-under-fire-Can-firms-prohibit-employee-complaints

#140 'Come on down....' on 02.09.16 at 8:28 am

“There are places in Canada where you can BUY a house for $120,000!”

“whats the median household income in those places?”

more importantly, is there a Starbucks there?

#141 maxx on 02.09.16 at 8:40 am

#3 Victoria Real Estate Update on 02.08.16 at 5:44 pm

“IT ISN’T DIFFERENT IN CANADA…….”

Yes.
Were I a foreign investor looking abroad for re, it certainly wouldn’t be now in Kooky Canoocky, with its funny little dollarettes, it would be in the USA.
There, at very minimum, you get better weather with way, way better service wherever you go.
Oh, and a very strong whiff of optimism.
Everywhere.

#142 Herb on 02.09.16 at 8:41 am

#97 Shine on You Crazy Diamond,

Simple economics – prices follow the law of supply and demand.

Except that in this case the law of supply and demand is fractured by the insertion of an unlimited supply of cheap money. Withdraw that and see what happens to prices.

#143 maxx on 02.09.16 at 9:05 am

#19 Scott on 02.08.16 at 6:09 pm

“The commodity collapse may be illogical but it can be illogical much longer than you can be solvent.”

Excellent comment and quite true.
Welcome to global fiscal tugs-of-war. On steroids.
They are definitely here to stay and will manifest in commodities, currency, equity markets, trade restrictions and who knows what else.
Institutional investors have got it right. Volume stays on the sidelines or gets steamrolled.

#144 Daisy Mae on 02.09.16 at 9:07 am

CBC, Feb.9th: http://www.cbc.ca/1.3439475

#145 Smoking Man on 02.09.16 at 9:11 am

If anyone don’t think Canada is heading to Negative rates give your head a shake.

#146 Herb on 02.09.16 at 9:12 am

#136 SM,

actually, that’s an image of a climate change denier protecting the freedom of the O&G cartel to feed unmolested.

She even looks like a useful idiot.

#147 Nancy Raganathan on 02.09.16 at 9:25 am

The U.S. 10 year is going to 0.75% in the next 12 to 18 months so bonds will outperform stocks. Stocks will not gain 25% to 30% in that time.

#148 Keith on 02.09.16 at 9:26 am

Why do you hate me so Garth? I thought we were besties.

It’s your hair. — Garth

#149 ROCK BEATS PAPER on 02.09.16 at 9:27 am

US NOT IMPLODING.

People seem to think that the market and the economy are synonomous. The economy is not imploding and nor will the global economy.

In the US, it is not 2007 with bubble house prices (San Fran excluded) and oil was a headwind at $150 a barrel. This year it will be a tail wind.

The markets however are way over priced and earnings have been contracting for 3 quarters.

#150 Unhinged Loon on 02.09.16 at 9:29 am

Just doubled my money in Ethereum digital currency while the rest of my “legacy” portfolio rots away.

Europe tanking despite cash injections, China under-performing, S&P correcting hard etc.

#151 Nancy Raganathan on 02.09.16 at 9:30 am

By the way, Bank of Canada is already doing QE, Canada bond purchases to lower all bond , yields behind the scenes as the 2, 5, 10, 30 year is 0.33%,0.49%, 1.02%, 1.85%.

I know people will deny it but they are doing it and that is why they did not cut rates in their last meeting January-20-2016.

#152 cramar on 02.09.16 at 9:42 am

#111 Leo Trollstoy on 02.08.16 at 11:22 pm

There are places in Canada where you can BUY a house for $120,000!

whats the median household income in those places?

———————-

Probably half or less what it is in Vancouver! Which means with house prices one tenth of Vancouver, you actually can afford to buy.

Here’s a starter home for example. Asking $110,000, and better than the $2.4 million fixer in Vancouver.

https://www.realtor.ca/Residential/Single-Family/16531110/3365-TURNER-WINDSOR-Ontario-N8W3M4

Three Starbucks within 10 min.

#153 cramar on 02.09.16 at 9:57 am

#128 PPT on 02.09.16 at 2:24 am

The Plunge Protection Team was given a massive assignment yesterday to keep the DOW above 16,000 and SP above 1850.

The Twitterverse and the major US financial sites are abuzz with how the PPT is openly rigging the markets in the last hour of trading when there is absolutely no news for the turnaround.

The markets are rigged. Show me the data that they aren’t!

——————–

The small rise in the last hour was probably trader short covering and some buying due to a short-term oversold condition. If the PPT really was behind it, all they needed to do was a follow-up and buy a large number of futures contracts overnight and drive the market up huge at open. Since that was not the case, one can argue that the PPT is totally inept.

I suspect the buzz was planted by sources hoping to convince the sheeple to start to buy on the coattails of the PPT. Which all means a rigged market, but not due to the mythical PPT, which sure didn’t do a thing back in 2008-2009 or earlier with the 2000+ markets.

#154 investment abs on 02.09.16 at 10:04 am

CMHC released a survey result late last year about “foreign ownership” of condos in major Canadian cities (3.5% in Van and 3.3% in GTA)

https://www03.cmhc-schl.gc.ca/catalog/productDetail.cfm?cat=193&itm=1&lang=en&fr=1455029223465

CMHC clearly differs from popular media. The question is: do you trust the government numbers? If not then who do you trust, Globe, VanSun, TorStar?

#155 economictsunami on 02.09.16 at 10:08 am

The real dilemma: Debt, Deleveraging & Demographics

A note for your calendars: the end of the credit cycle:

http://ftalphaville.ft.com/2016/02/08/2152529/a-note-for-your-calendars-the-end-of-the-credit-cycle/

Steve Keen: Our Dysfunctional Monetary System:

http://www.forbes.com/sites/stevekeen/2016/02/06/our-dysfunctional-monetary-system/#74aa15526a35

Increasingly larger amounts of debt, needed for decreasingly/ diminishing returns…

#156 Sideshow Rob on 02.09.16 at 10:22 am

David Stockman isn’t buying what the Fed is selling either. Very smart guy. Ignore at your own risk.

http://www.bloomberg.com/news/videos/2016-02-09/david-stockman-markets-going-to-be-mauled-by-bear

#157 Calgary Rip Off on 02.09.16 at 10:41 am

And now in Calgary…Ugly traffic and greedy oil people who didnt purchase mortgages within their need. GREED GREED GREED.

https://ca.finance.yahoo.com/news/jingle-mail-rears-ugly-head-090000984.html People in Alberta walking away from mortgages.

#158 Noel on 02.09.16 at 10:45 am

Buying the house will be the safest move in the long term if you’re planning on living there for a while. Houses are still cheap in US$ terms, meaning the market has tons of room to run.

You can be the smartest person in the world and still lose your pants by gambling in ones and zeros on the stock market, or you can buy a physical asset that you can actually live in and not be lorded over by an absentee landlord.

Take out the big loan and buy the house, interest rates are never going up to where they were in the past. You’ll regret it if you don’t, just like you probably regret not buying 5 years ago when you thought houses were overvalued.

#159 Dups on 02.09.16 at 10:51 am

Choppers are so 90’s…
Now we have satellite view from Google for free.
They are trying to advertise and brain wash us…

Markets keep laying little eggs and big eggs, ah I wish we had more TFSA room for these times.

#160 dr. Talc on 02.09.16 at 10:57 am

Greed? Flippers are near tbe bottom of the financial pyramid, yet higher up than ‘investors’. Flippers at least take out tbe garbage.

#161 Basil Fawlty on 02.09.16 at 11:01 am

Somehow the statistics indicate that the global economy is growing. Meanwhile, in the real world, manufacturing, shipping and retail are falling hard.
This continues to be ignored by the Unicorn chasers, even after all the manipulations of libor, forex and virtually all statistics. This is the same group that continue to ignore the precious metals market, while insisting that a turd can be picked up by the clean end.

#162 Bottoms_Up on 02.09.16 at 11:02 am

#127 Freedom First on 02.09.16 at 1:59 am
—————————————
He also allows FF to mock the notion of commitment.

#163 Smoking Man on 02.09.16 at 11:06 am

#144 Herb on 02.09.16 at 9:12 am
#136 SM,

actually, that’s an image of a climate change denier protecting the freedom of the O&G cartel to feed unmolested.

She even looks like a useful idiot.
……………..

Herb you’re an old bastard, can’t believe you swallow this climate bs, OK another question, what are you invested in? Is it making money?

Obviously you got skin in the game, if not, and you’re not a little dumb down indoctrinated kid.

You should get checked out for Dementia.

#164 Sunders on 02.09.16 at 11:07 am

“Emotion, not logic, leads people to fear lower lows and expect higher highs.”

The heart is deceitful above all things and beyond cure. Who can understand it?

#165 Ronaldor on 02.09.16 at 11:11 am

#156 Noel

”Take out the big loan and buy the house, interest rates are never going up to where they were in the past.”

Just as they were saying back in the 74 housing peak just before it crashed that interest rates would never go below 10% ever again. Back then interest rates only increased from 10% to 12% to stop the nonsense. Today, the equivalent would be 1/2 to 1% given the extreme low rates. Stay as far away from this market as you can. 2016 will be the year of reckoning.

#166 pwn3d on 02.09.16 at 11:11 am

5 year bond yields at an all time low, <.5
Fixed mortgage rates about to drop.
Market is already crazy and it's only Feb.
2016 will be a great year to sell RE. Maybe finally the top? Everything seems to be converging that way.

#167 theyarewatchingyou on 02.09.16 at 11:28 am

#159 Basil Fawlty
“This continues to be ignored by the Unicorn chasers, even after all the manipulations of libor, forex and virtually all statistics. This is the same group that continue to ignore the precious metals market”

Who better to preach about ‘ignoring’ than an ignorant conspiracy theorist doomer?

You guys are pros:
Data that doesn’t fit your preconceived notions? Conspiracy!
Markets react in a way you didn’t expect? Conspiracy!
Left-wing politician becomes popular? Conspiracy!
Right-wing politician becomes popular? Conspiracy!
Your toast falls with the butter side down? Conspiracy!

Makes me wonder who ever said ignorance was bliss; you tools always seem so stressed out.

#168 Shine on You Crazy Diamond on 02.09.16 at 11:33 am

http://bc.ctvnews.ca/surging-real-estate-makes-2-3m-for-b-c-cabinet-as-affordability-worsens-1.2751578

#169 dosouth on 02.09.16 at 11:39 am

It’s the Millennial age where you leave your personal security to Apple, McAfee and LinkedIn. You put your trust in Twitter, SnapChat, Facebook, Instagram and any thing else other than main stream media. Fact checking is so yesterday and posting what you ate, drank and then disposed of is really important to you(not your friends if you care)

So believing that “helo lady exists was probably, most likely nay must have been started by a Millennial realtor but then I didn’t check my facts either…

So decisive is a tern that the Millennials should remove from their CV’s and stick with something like, “I am decisive and can make a decision when needed…or I think I can, maybe not, sure I can, maybe…”

#170 waiting on the westcoast on 02.09.16 at 11:57 am

124 Joe2.0 on 02.09.16 at 1:00 am says “The Global economy is growing? Then why has the Baltic Dry Index crashed?”

You should understand that the Dry Baltic index is a ratio of supply/demand.

It is not a zero-sum game. It is not an indication of actual traffic/trade. But of the gap between supply of ships and demand for said supply.

#171 TurnerNation on 02.09.16 at 12:03 pm

Market rout will drive housing market further.

This week Danier and now Guestlogix (GXI.TO) have gone tango uniform. BK
Rona taken over. BBD given last rites unless QC bails out, using taxpayers.

#treasuryblondes this quarter.

#172 waiting on the westcoast on 02.09.16 at 12:04 pm

#159 Basil Fawlty on 02.09.16 at 11:01 am says “Somehow the statistics indicate that the global economy is growing. Meanwhile, in the real world, manufacturing, shipping and retail are falling hard. This continues to be ignored by the Unicorn chasers, even after all the manipulations of libor, forex and virtually all statistics. This is the same group that continue to ignore the precious metals market, while insisting that a turd can be picked up by the clean end.”

My businesses are in the real world and have been growing substantially for the past 4 years (especially the last two). We are a service business that is not generally needed (more a nice to have) and was hit hard during the recession when people had either too little capital or too much fear at the time. Right now in the US, people are relatively buoyant on mainstreet.

I will give some numbers in the next couple of days when our stats come out.

#173 MF on 02.09.16 at 12:04 pm

#156 Noel on 02.09.16 at 10:45 am

That’s the whole point. If you “plan on living there for a while” go ahead and owe the bank execs a million (plus interest) and hope for the best. In our time, especially for we millennials, being able to get up and go to where the higher paying job is is everything.

By the way, I took out 550$ of “zeroes and ones” from my unregistered account and bought a lap top. Vender didn’t mind accepting these “zeroes and ones”.

MF

#174 Blogbitch on 02.09.16 at 12:08 pm

Marlene, I don’t care what generation you’re from or think you are from. The reality is that you are 35 years old. It’s time to put on your big girl panties and take charge of your finances and your future. I hope to God you’ve been saving and investing a healthy percentage of that handsome salary you’ve been earning every year. As we know, it’s not what you earn, it’s what you keep. You sound like you’re still at the beginning of your journey. Keep reading everything you can get your hands on and think very, very hard about what life may look like 35 years from now. For you, that’s an entire lifetime. It’s time to get smart and look after yourself, sister.

#175 Ace Goodheart on 02.09.16 at 12:23 pm

Houses south of the 401 in Toronto for under 500K:

https://www.realtor.ca/Residential/Single-Family/16572406/34-EMMETT-AVE-Toronto-Ontario-M6M2E6-Mount-Dennis

https://www.realtor.ca/Residential/Single-Family/16555495/21-GREENDALE-AVE-Toronto-Ontario-M6N4P4-Rockcliffe-Smythe

https://www.realtor.ca/Residential/Single-Family/16421210/393-OLD-WESTON-RD-Toronto-Ontario-M6N3A9-Weston-Pellam-Park

There are lots more.

You don’t have to spend a mil to get a detached Toronto house. You just have to be willing to live in a “not so prime” neighbourhood, and to send your kids to a “not so popular school”.

#176 MF on 02.09.16 at 12:25 pm

#169 TurnerNation on 02.09.16 at 12:03 pm

Wouldn’t it be the opposite? As stocks become cheaper people sell their RE and buy them in anticipation of making money?

MF

#177 Noel on 02.09.16 at 12:38 pm

#163 Ronaldor
#171 MF

Most people aren’t patient or smart enough to successfully invest money. Congratulations if you can.

Mortgages force people to save, and can be highly leverged by your average joe- which isn’t true for financial assets.

Housing is the best place to put your money for the vast majority of Canadians, especially in Toronto and Vancouver.

#178 SWL1976 on 02.09.16 at 12:41 pm

#161 Smoking Man

#144 Herb on 02.09.16 at 9:12 am

#136 SM,

actually, that’s an image of a climate change denier protecting the freedom of the O&G cartel to feed unmolested.

She even looks like a useful idiot.
……………..

Herb you’re an old bastard, can’t believe you swallow this climate bs, OK another question, what are you invested in? Is it making money?

Obviously you got skin in the game, if not, and you’re not a little dumb down indoctrinated kid.

You should get checked out for Dementia.

——————————

Smoking Man – I’m still surprised you can’t see the forest for them trees. Besides I thought we went though all this last week to which you did not reply from your new cottage on bull shit lake?

Anyways, climate change is happening now at an accerlerated rate.

You know what else is happening???

Big oil and corrupt governments are also using the crisis to further tax us and compond the problem at our expense.

Nothing like a good crisis to futher give us the squeeze

Get out of that smokey casino and spend some time in the north if you want to see climate change. Or simply acknowledge that 17 degrees C in Ontario in Feburay is not normal.

Give the JD a rest. Your brian may be getting wet

#179 TurnerNation on 02.09.16 at 1:15 pm

MF ahahaha! People never will sell RE. As bigarider points out it goes Uppa uppa

Until the word “investment condo” becomes relegated to Urban Dictionary fodder will kandos sell in TO.

#180 Ronaldo on 02.09.16 at 1:22 pm

#175 Noel

”Housing is the best place to put your money for the vast majority of Canadians, especially in Toronto and Vancouver.”

That may have been the case at one time when housing was 2.5 to 3 times ‘single’ income and not the 8 to11 times ‘family’ income as it is in the major bubble areas. This is probably one of the most dangerous times to invest in these overpriced areas. Most people change homes on average every 3 to 4 years. Homes can become a major trap for people needing to move to find work (like in Alberta now). The past will tell you where the future lies. The only thing that is different today is that it is much much worse.

#181 Armando on 02.09.16 at 1:22 pm

Is “There’s a big sale” Garthian for we are in a bear market? I guess in 2008 there was a “big big big big sale”. The problem I have with Garth’s analysis is that he’s basically saying that the “sale ‘isn’t going to get any bigger because the economy isn’t doing that badly. Unfortunately, he’s looking at things backwards: The stock market is a LEADING indicator. So by the time it is obvious that the economy is in the dumpster the market is already down 30% – 50%! Trying to invest using the current economic situation as a guide is like driving a car using the rear view mirror. Not good for your financial health!

There is no reason for a market decline of that order. — Garth

#182 Peter on 02.09.16 at 2:16 pm

Reply to #29

“Rent a nice condo close to work. Enjoy your life. Not owning gives so much more freedom. Spend that 1.5 hours you would spend commuting walking the seawall, or doing yoga in the park, or drinking coffee with some bearded fashion victim that doesn’t own a car and rides a fixed gear bike.. all of which are better than commuting.”

IF you can FIND a rental condo. That’s the part of the problem, here, in Lotus Land. Available and affordable rental properties are a scarce breed.

#183 Smoking Man on 02.09.16 at 2:16 pm

The Machine Owns All, quest for one world government.

How will it achieve its goal, divide weaken and destroy, get everyone hating each other?

Let take it back to the fifties Prosperity galore, Family units, no gender wars, no hate crimes, words were words no one got upset. Now

Today Climate Change Vs Logic. Woman Vs Men. Ghomeshi will lose in the court of public opinion but the court will rule him innocent especial now that a few of the accusers admit they colluded to bring him down, just shy of the line of perjury. This is how it’s done.

An exchange between Barrington and Smokey in my book. Smokey responds to Barrington after he accusing him on becoming a low life Human.

“I’m turning into a human? You’re the guy who just pulled back the Negro word in exchange for African American. But perhaps you’re right, we have been on earth far too long, we are losing logic with every passing day, worried about using words that people pretend to piss them off so they can get advantage over rivals, this is mind fking by the machine is all I’m saying.”

“Smokey, it’s call Cultural Marxism. It’s all over the place at my University. Complete mind control designed to have everyone hate each other resulting in a weak society, it’s goal to produce a one world government. That’s how they did it on Nectonite, I don’t except a spaceship pilot to understand or care.” He said.

#184 Markets Smarkets on 02.09.16 at 2:17 pm

Met a realtor last nite. Basically said that economy sucks but Vancouver real estate continues to go up because has nothing to do with rest of Canada. I believe him as the proof is in front of me.

Every home going above asking with multiple offers.

#185 Penny Henny on 02.09.16 at 3:04 pm

Riddle me this Smokey.
-oil down big
-gold flat
-tsx down big

dollar up?

#186 MF on 02.09.16 at 3:08 pm

#175 Noel on 02.09.16 at 12:38 pm

Mortgages force people to save? Going out and blowing most or all their life savings in return for about a million in debt to the bank is what is considered “saving” now?

I can’t imagine what spending is like.

The time to buy houses was in 2004.

MF

#187 MF on 02.09.16 at 3:09 pm

#177 TurnerNation on 02.09.16 at 1:15 pm

Right. Uppa Uppa…until is does not and you can’t Sella Sella.

MF

#188 Ive got a shitty book to sell. on 02.09.16 at 3:32 pm

#181 Smoking Man on 02.09.16 at 2:16 pm

The Machine Owns All, quest for one world government.

How will it achieve its goal, divide weaken and destroy, get everyone hating each other?

Let take it back to the fifties Prosperity galore, Family units, no gender wars, no hate crimes, words were words no one got upset. Now

Today Climate Change Vs Logic. Woman Vs Men. Ghomeshi will lose in the court of public opinion but the court will rule him innocent especial now that a few of the accusers admit they colluded to bring him down, just shy of the line of perjury. This is how it’s done.

An exchange between Barrington and Smokey in my book. Smokey responds to Barrington after he accusing him on becoming a low life Human.

“I’m turning into a human? You’re the guy who just pulled back the Negro word in exchange for African American. But perhaps you’re right, we have been on earth far too long, we are losing logic with every passing day, worried about using words that people pretend to piss them off so they can get advantage over rivals, this is mind fking by the machine is all I’m saying.”

“Smokey, it’s call Cultural Marxism. It’s all over the place at my University. Complete mind control designed to have everyone hate each other resulting in a weak society, it’s goal to produce a one world government. That’s how they did it on Nectonite, I don’t except a spaceship pilot to understand or care.” He said.
………………………………………………………………….
It always comes down to this shitty science fiction book you are attempting to flog. Wow your a real William Lind in the conspiracist sense.

#189 Ponzius Pilatus on 02.09.16 at 3:35 pm

#182 Markets Smarkets on 02.09.16 at 2:17 pm
Met a realtor last nite. Basically said that economy sucks but Vancouver real estate continues to go up because has nothing to do with rest of Canada. I believe him as the proof is in front of me.

Every home going above asking with multiple offers.
——————–
You had a meeting with yourself?

#190 Smoking Man on 02.09.16 at 3:42 pm

#183 Penny Henny on 02.09.16 at 3:04 pm
Riddle me this Smokey.
-oil down big
-gold flat
-tsx down big

dollar up?
…………

No fricken Idea.

As I’ve told my apprentice, sit it out for a while.

#191 gut check on 02.09.16 at 3:43 pm

@ #183 Penny Henny on 02.09.16 at 3:04 pm
Riddle me this Smokey.
-oil down big
-gold flat
-tsx down big

dollar up?

************************
I think this is yer trouble:

http://ca.investing.com/quotes/us-dollar-index-streaming-chart

#192 Noel on 02.09.16 at 3:48 pm

#184 MF on 02.09.16 at 3:08 pm
#175 Noel on 02.09.16 at 12:38 pm

Mortgages force people to save? Going out and blowing most or all their life savings in return for about a million in debt to the bank is what is considered “saving” now?
______________________

You can disagree with the efficacy of it, but taking out a mortgage and buying a house is the textbook definition of forced savings.

You probably would have been saying the same thing 5 years ago about houses, consumption and ‘blowing’ your life savings. Fact remains that anyone who bought a house 5 years ago is substantially better off than if they didn’t.

I believe the same holds true today as it did 5 years ago. I could point out several indicators that are supportive of housing over the short to medium term, but don’t feel like wasting my time with a lengthy post that most will dismiss.

Short thesis, housing prices and demand relate to population flows and demographics, and this trumps any short term pressures mounting from interest rates, employment and household wealth – at least in desirable urban centers.

#193 Freedom First on 02.09.16 at 3:54 pm

#160 Bottoms_Up on 02.09.16 at 11:02 am

#127 Freedom First on 02.09.16 at 1:59 am
—————————————
He also allows FF to mock the notion of commitment.

Are you trying to say that I mock the notion of commitment? I am very committed, to me. What’s wrong with that? It’s called self preservation. I don’t want some female gutting me in the court system, taking away my dignity to do what I want, when I want, with who I want, where I want. I’m a terrific person who just wants to be left alone…Freedom First, like I always say.

#194 CJBob on 02.09.16 at 4:14 pm

#190 Noel on 02.09.16 at 3:48 pm…
Short thesis, housing prices and demand relate to population flows and demographics, and this trumps any short term pressures mounting from interest rates, employment and household wealth – at least in desirable urban centers.
________________________
Agree with you on the logic and the fact that most here don’t want hear it.

#195 juno on 02.09.16 at 4:22 pm

Looking at oil stocks today.

Wondering if OPEC can get control and re-establish some control over oil prices, after all T2 says don’t worry and be happy to the un-employed oil workers.

But the truth is Iran , Saudi Arabia are desperate for money, add Russia and south America in the mix and you got a soup of desperate countries whom can do nothing but pump more oil.

The consumption of oil has gone down, and the surplus is overflowing. So to Alberta, don’t expect things to get better for another 2 to 3 years.

On the flip side cheap oil will help the US grow bit. Still waiting but soon the big oil companies will be eating up the smaller one’s just like 2000 when the big gold companies ate up the smaller ones.

#196 acdel on 02.09.16 at 4:45 pm

#188 Smoking Man
#183 Penny Henny on 02.09.16 at 3:04 pm
Riddle me this Smokey.
-oil down big
-gold flat
-tsx down big

dollar up?
…………

No fricken Idea.

As I’ve told my apprentice, sit it out for a while.
#183 Penny Henny on 02.09.16 at 3:04 pm
Riddle me this Smokey.
-oil down big
-gold flat
-tsx down big

dollar up?
…………

No fricken Idea.

As I’ve told my apprentice, sit it out for a while.
—————————————————————-

Do you guys think that it could be related to the Deutsche Bank; down 51% in a year? Never mind what is happening in the rest of Europe; what a nightmare. I sure would like to hear from others that have more expertise then I do in this field, is this another possible meltdown such as 2008/2009?

#197 Freedom First on 02.09.16 at 4:58 pm

#191 Freedom First

Not me. But a pretty good message.

Except for the fact that I don’t give a shit. Post under my name all you want. Like SM says, you can bend over, but I take no offense. Or something like that.

#198 MF on 02.09.16 at 5:05 pm

#190 Noel on 02.09.16 at 3:48 pm

You think housing will go up forever? I’m talking about the GTA.

MF

#199 Godth on 02.09.16 at 5:15 pm

#181 Smoking Man on 02.09.16 at 2:16 pm

Situation normal.
http://www.peakprosperity.com/blog/96701/return-crisis

https://www.youtube.com/watch?v=Kp6_sDiup6U
https://www.youtube.com/watch?v=mYynn9B7uns

Consciousness evolves but that doesn’t mean humans are part of the outcome.
https://www.youtube.com/watch?v=IESYMFtLIis

https://www.youtube.com/watch?v=cbuD3drzodg&index=9&list=PLWYFrQa5cYBEdoeIgFnZdJW4c9Md-jFnL

#200 salonist on 02.09.16 at 5:46 pm

entertainment

Numbeo is the world’s largest database of user contributed data about cities and countries worldwide. Numbeo provides current and timely information on world living conditions including cost of living, housing indicators, health care, traffic, crime and pollution

http://www.numbeo.com/cost-of-living/

#201 Smoking Man on 02.09.16 at 5:48 pm

#197 Godth on 02.09.16 at 5:15 pm
#181 Smoking Man on 02.09.16 at 2:16 pm

Situation normal.
http://www.peakprosperity.com/blog/96701/return-crisis

https://www.youtube.com/watch?v=Kp6_sDiup6U
https://www.youtube.com/watch?v=mYynn9B7uns

Consciousness evolves but that doesn’t mean humans are part of the outcome.
https://www.youtube.com/watch?v=IESYMFtLIis

https://www.youtube.com/watch?v=cbuD3drzodg&index=9&list=PLWYFrQa5cYBEdoeIgFnZdJW4c9Md-jFnL

……………………….

Sad day when God loses his mind and buys into the scam of the century.

#202 Smoking Man on 02.09.16 at 5:53 pm

Godth

See two sides to every story

http://www.breitbart.com/big-government/2016/02/09/the-profiteers-of-doom-were-wrong-about-climate/

#203 Keith in Calgary on 02.09.16 at 6:01 pm

You are wrong Noel.

I didn’t buy a house 5 years ago and put a post on her a few days ago with my numbers.

I am 5 times ahead $ wise than a home debtor is

#204 Godth on 02.09.16 at 6:15 pm

#200 Smoking Man on 02.09.16 at 5:53 pm

I see both sides to the story, doesn’t change the fact that human industrial civilization is a volcano going off 24/7 – 365. The climate models are likely wrong as mapping non-linear systems is virtually impossible (see economic models) but that doesn’t mean shit isn’t getting fucked up and covered up every which way. Situation normal.

https://www.youtube.com/watch?v=7g4NbhgpgRU

#205 acdel on 02.09.16 at 6:30 pm

Coco’s

Never heard of them until this article.

Bloomberg.

http://www.bloomberg.com/news/articles/2016-02-09/how-the-bank-debt-that-everyone-is-talking-about-works-q-a

#206 GenXer on 02.09.16 at 7:28 pm

136 Smoking Man on 02.09.16 at 8:06 am There is a reason I call them tree huggers.

Complete waste of tax payer money. But some cronies get rich.

http://business.financialpost.com/news/agriculture/why-ontario-is-struggling-to-find-homes-for-50-million-trees

Planting trees makes you mad, but billions of $ in gas and oil subsidies every year is ok. At least the trees will still be here in 15 years. Put down the cuckservative kool aid and ask yourself. Who is really getting rich?