Moister 101

It rained a tad. Not so warm, either. The OPP decided to do some kind of coppy blitz right in front of the General Store. And Smoking Man showed up in actual shoes. But despite those grave obstacles, the little Belfountain blog dogapolusa on Saturday was fun – in a quaint, twisted, suspicious sort of way. More on that in a moment. Plus a quiz.

First we need to talk to Ben. He wrote me on the weekend, and given the events of the last few days – Trump losing it over the FBI dude, the latest NK missile launch, new prez in France, Greens running BC, beaver banks downgraded etc. – it seems this is as good a time as any to talk about where to put money. There are lots of risks on the margins, and any one of them could erupt in ways yet unknown. The fear of loss keeps millions from ever investing properly because, alas, they don’t come here.

Ben said:

Relatively young impressionable fan here (I think you call us ‘moisters’?) hoping you’ll consider updating some old advice. I’m 30, lean bank account, getting married in the fall…and trying to finally get smart about money. Your blog is helping a lot.

You’ve previously written about good investment profiles – yes, I did go back through three years of posts. (If that’s not flattery I don’t know how to do it…). You laid out the wisdom I was searching for on 15/05/2014 when you answered the question “What should a millennial invest in for a period of four to five years while waiting for the housing gasbag to erupt and prices to moderate?”.

That was 5 years ago, and too bad I didn’t have assets with which to follow your advice then. Now it’s 2017, I’ve got 60k doing nothing in the bank and the possibility of adding another 20k a year to it. I’ve got a financial advisor who tells me a stock market downturn is on the horizon and I should invest 80% in short-term bonds. Those rates of return are painfully low. Can you help me (and other trying-to-dessicate moisters) do better?

So you don’t have to dig through the archives, here’s your advice from 2014:
20% Canadian bond index ETF
20% Preffered share index ETF
15% Canadian equity index (large cap) ETF
20% US equity index (large cap) ETF
20% International equity index (large cap) ETF
5% REIT index (Canadian) ETF

Congrats on the upcoming marriage, Ben. Remember when you get hitched that smart couples co-mingle their financial lives. Establish a joint investment account to help with tax-shifting, and be insurance in case something unexpectedly happens to one of you down the road. Max both your TFSAs first. If there’s an income disparity, use a spousal RRSP to split income. Set a budget. Do not have separate bank accounts. There is no ‘his’ or ‘her’ money. The day you slip the ring is the one you become a single economic unit. Resist that notion and the relationship will never gel. I mean how can you truly trust someone with their own debit card?

As for your portfolio, yes, it’s modest. No, you don’t have enough to even think about buying real estate. And, definitely, you need to fire whatever wuss you picked as an ‘advisor.’ Eighty per cent in short-term bonds? Seriously? The biggest ETF in that space gave a total return last year of just 1.5% – which was less than the inflation rate. Hardly the way for an ambitious moister to get ahead.

Besides, bonds (even short ones) are negatively affected by rising interest rates – and that is what to expect over the next year. The Fed has increased twice since December and will do it at least twice more by Christmas. Bond values go down when rates go up. So you’re far better off to have a good weighting in rate-reset preferreds, which not only give a fat yield (now 4.5%) but are tax-efficient (unlike bonds) and will probably deliver a capital gain as the cost of money slides higher. A small bond weighting is fine to reduce volatility, but mix it up with some higher-yielding corporates or provincials.

The stock market falling? Which one? A diversified portfolio has exposure to various markets, broken down geographically and by company capitalization. In any case, if Trump’s tax-slash plan becomes law, today’s US equity markets will look cheap.

The point of a balanced, diversified and liquid portfolio is to be invested and not worry about temporary market fluctuations. Nobody knows what will happen next, so this asset mix allows for income, mitigates volatility, protects in periods of decline and grabs growth when markets advance. Any advisor who says they can ‘add alpha’ and beat the market is a con or a fool.

The current recommended weightings: cash, 5%; corporate bond 6%; provincials 3%; short-term bond 5%; high-yield 3%; preferreds 18%; Cdn equity 16%; REITs 5%; US equity 21% (some hedged); international equity 18% (some hedged).

Let’s see where you’re at in five years. She’ll love it.

Dogapalusa - a pathetic blog, in real life

It should have been more awkward that it was. After all, dozens of people (and endless dogs) gathering in one place who think they know each other, but don’t know squat. They drifted in and out of the Belfountain General Store Saturday afternoon, seemingly normal human beings with big online egos lurking within. None bigger, of course, or more twisted than that of Smoking Man, whose deluded idea it was to have an event and draw people out of their anonymous shadows.

So we ate ice cream. Listened to some live music. Ate Lorna’s bespoke sandwiches. Snorfled pastries. Fed dog treats. And talked. It was so successful I fear a repeat.

“Grup shit!,” SM called out at one point, assembling the nearest bodies around him. There are eight regular bloggers in that picture above. Guess who.

152 comments ↓

#1 Sebee on 05.14.17 at 6:33 pm

I feel warm and fuzzy inside due to all this blog love.

#2 Paully on 05.14.17 at 6:38 pm

Very sorry that I missed it this time. Looking forward to the next one! I’ll be there!

#3 Mauro on 05.14.17 at 6:42 pm

Hi Garth

I’m a 37 male not married yet but targeting within 1-2 years.

I hold a job at a big bank pretty secure and make 105,000 with bonus.

I invest in Mutual Funds and ETFs. Balanced and maxed out all registered accounts.

I have no debts and currently live at home rent free. Sold my condo couple years ago and took the profits.

I’ve started to seriously look for a home. Townhouse semi or detached. GTA – Etobicoke, Vaughan or North York. My down payment is $400,000 and I am pre-approved for another $400,000. This scenario will leave me significant savings still.

Doesn’t look like home prices will ever flatline or decline. I know you and other say they will but when how when how?????!!!!!!

I think I’m pretty much screwed for life now. I don’t want a condo again nor do I want to rent.

Perhaps I buy in Bradford. Perhaps I just give up. Perhaps I stop listening to Garth, Ross Kay, Cohodes and Hilliard. Perhaps it is different here. Perhaps that $800,000 run down bungalow in Etobicoke will be 1.2MM next year.

Perhaps I visit a fortune teller.

Oh the despair. It’s consuming. I blame everyone. But I blame myself the most. I should’ve bought. I should buy. And I think I will.

#4 crowdedelevatorfartz on 05.14.17 at 6:53 pm

Geez the OPP staked out the party eh?
Just like the Hells Angels?
Smokey’s reputation preceeds him…

Well.
Other than Smoking Man ( sans cigarette) I have no idea.

I just know who wasnt there … me

#5 Running Uncle on 05.14.17 at 6:55 pm

Smoking Man for the Gold Medal! We all love him. I wonder what his asset mix is?

#6 jess on 05.14.17 at 7:06 pm

Uncovering More Trump Ties to Mobsters and Shadowy Oligarchs
A Trump Business Partner Threatens to Reveal a Vast Network of Murky Relationships

By David Cay Johnston, DCReport Founder and Editor

“Behar’s DCReport exclusive is a roadmap for Congressional and FBI investigators as well as other journalists. It advances what we expect time will show is the most important story in the history of the United States, the story of how Moscow and Russian money may have helped put Vladimir Putin’s favored candidate in the White House.”
https://www.dcreport.org/2017/05/12/uncovering-more-trump-ties-to-mobsters-and-shadowy-oligarchs/

#7 AB Boxster on 05.14.17 at 7:15 pm

Time to open a new store out in glorious Alberta Garth.

Us deplorables here keep missing out on these dog days.

The west wants in!

#8 Interstellar Old Yeller on 05.14.17 at 7:17 pm

Love the Dogapalusa report! Glad it was a success and fun (“fun”?)

#9 Mattl on 05.14.17 at 7:18 pm

Ben should have bought real estate in 2014. He would be 15-20% towards paying off a property and would be 100-200k ahead in net worth. Instead he got one of the 98% of bonehead advisors, has paid 35-50k in rent and at 20k savings per year and renting can look forward to retiring once they put him in the ground.

Ben is the exact reason most Canadians should own property. There is no balanced etf way to prosperity, 6% return, 20k a year contributions, 4-6 percent safe withdrawl and 30k a year rent means working forever. Would love to see a post on how a middle class family guy pays rent forever in a city where there are actually jobs and comes out ahead of the same guy that buys a home and pays it off in 20-25. I get mobility and all that but there can not be any greater killer of wealth than renting for 20-60 years. The ony guys I know with wealth that rent already made a killing on real estate.

So my advice to Ben would be find a market where you can afford a starter home and have a decent job, max out your rrsp’s, roll the tax return into a tfsa and in 20 years you will be a million miles ahead of where you would be with a rental and a maxed tfsa.

Telling a kid without money (in 2014) to get 100% leverage and have a one-asset strategy is the height of irresponsibility. — Garth

#10 rae on 05.14.17 at 7:18 pm

#4 Mauro, might I ask, have you already found the bride to be and if not, what are you looking for in a woman?

Just wondering what it takes to snag a financially savvy guy such as yourself.

#11 Sebee on 05.14.17 at 7:25 pm

#5 Running Uncle on 05.14.17 at 6:55 pm
Smoking Man for the Gold Medal! We all love him. I wonder what his asset mix is?

I’m going to guess 10% of portfolio is in flip flops. :-)

#12 Tony on 05.14.17 at 7:34 pm

Re: #3 Mauro on 05.14.17 at 6:42 pm

Buying into one of the biggest housing bubbles in the world is probably the worst decision you could ever make in your entire lifetime. If the Chinese yuan keeps on falling in value vis-a-vis the U.S dollar and the Canadian dollar, money flowing out of China into GTA real estate will dry up completely. If Trump hits China with tariffs housing in the GTA will crater.

#13 When Will They Raise Rates? on 05.14.17 at 7:37 pm

#3 Mauro on 05.14.17 at 6:42 pm

Perhaps I visit a fortune teller.

—————–

Or perhaps you should sit tight for 2 weeks and wait for May sales numbers to be released before making any rash decisions…

How ironic would it be if you sat out the entire RE bull run in your mom’s basement saving, investing, staying liquid and being smart because you listened to Garth (rightfully so), only to capitulate and buy right as the market begins to melt down, just as Garth has predicted all along?

Listings have exploded and the buyers have vanished… Sub prime liquidity has evaporated… Even the realtors are turning bearish.

WAIT. ;)

https://cdn.meme.am/cache/instances/folder727/58038727.jpg

#14 Re, Mauro on 05.14.17 at 7:44 pm

Sorry bro. This blog is insightful . Unfortunately it’s been a real estate bear for years and looks like it pulled you in.

Yeah, you did screw up

Did you miss the part about no money five years ago? — Garth

#15 crowdedelevatorfartz on 05.14.17 at 7:50 pm

@#3 Mauro

You’re 37 years old, make 105k a year, you have zero debts, at least 400k to dump down on a dump…….and you live at home……..

You live at home….mama mia!

#16 Rainclouds on 05.14.17 at 7:54 pm

Rather selfish of you Ontarians (or as we call them here in BC, MIDDLE EASTERNERS) to go ahead with the biggest social event since Berkshire Hathaway last week.

May 2018:

Disheveled misfits converge, Motel 6 booked months in advance. Vats of heavily laced Bourbon AND MJ ice cream at the ready.

Much wisdom exchanged in spite of the incoherent yelling matches.Garth throws sprinkles in our eyes to restore calm…..(more than once:-)

Flop gets teary eyed, starts singing Waltzing Matilda(We all join in).

Mark gets a conditional pass till he blurts out a non verifiable comment, then, to the stockade..

Doug and Ryan huddled behind the pastry counter comparing the size of their German Engineered Rides.

WUL is retained in the event the OPP decides this motley collection of financial scientists with stained t- shirts and mismatched socks needs help leaving .

This baby could be the highlite of the Canadian 2018 social calendar

#17 Larry from ON on 05.14.17 at 7:56 pm

Mr. Turner,

Was a pleasure to meet you on Saturday, as it was to meet Smoking Man and some of the other blog dogs. I’m a long time reader, infrequent poster, but may start to post more often again.

@Mauro #3, here’s a link posted in the comments from the post a few days ago. Listings up will mean more choice for buyers, at lower prices. Don’t rush your next purchase.
https://betterdwelling.com/city/toronto/toronto-real-estate-agents-losing-st-charts/

Some anecdotal info from me. I live in a condo building in North York and there were 2 “open house” invitations for today between 2-4pm at my front door. There were 4 signs up for open houses at the local round about near my parents place. All of this on Mother’s Day. Heathens.

#18 [email protected] on 05.14.17 at 7:57 pm

Garth I see potential revenue streams overlooked, not entirely sure what we are looking at here however you need to disallow food not purchased on premesis such as Timmies, water bottles. No free wifi is the new trend. What about offering little dog cones/biscuits for the ones on fours? My consulting advice isn’t free though, I’ll send you the bill.

All covered. — Garth

#19 TLG on 05.14.17 at 8:00 pm

Wow, Mark Cuban even showed up.

#20 Pete on 05.14.17 at 8:08 pm

Picture quality is quite poor.

#21 Mark on 05.14.17 at 8:13 pm

“I’ve started to seriously look for a home. Townhouse semi or detached. GTA – Etobicoke, Vaughan or North York. My down payment is $400,000 and I am pre-approved for another $400,000.”

$400k+ net worth as a 37-year old? $100k job? Seriously, you’ve gotta stop worrying. You’re doing better than most other 37-year olds. Heck, even married 37-year-olds would love to have family net worth stats like you do.

Buying at this point would be like flushing money down the drain. Compared to how cheap it is to rent, comparatively speaking.

If you go back to the early 1990s, for example, and invested a 25% downpayment in 1990 into TSE index funds, a decade later, you would’ve been able to cash out for enough to buy a house in Toronto without a mortgage.

No reason to believe the same won’t happen again. So invest your $400k, and keep an eye on houses that currently cost in the $1.6M range or less. A combination of stock appreciation and housing depreciation will get you there in the next decade. I’m pretty sure.

#22 JR on 05.14.17 at 8:16 pm

Ben didn’t actually read the full 3 years of this blog. If he did, he would already know what to do. Smoking Man has been dispensing the real advice in the blog comments!

Thanks Garth. I love it when you give Smoking Man the recognition he deserves!

#23 Hugh Janus on 05.14.17 at 8:18 pm

Ben,

Your village called, they want their idiot back.

#24 Shortymac on 05.14.17 at 8:26 pm

I was sad to miss the get together, is there another one in the near future?

I was wondering if now would be a good time to get pre-approved and put in some low-ball offers. See if I can get someone to bargain from 800k to 500k. Might be a tad unrealistic.

Also, Mauro, there’s a house by me near yorkdale mall going for 800k if you want. It’s on realtor.ca (on mobile so no link)

#25 TurnerNation on 05.14.17 at 8:29 pm

Logged in to check futures…
Wonder if SM’s ‘agents’ materialized.

How many blogs could a blog dog log if blog dogs could log blogs?

M41ON

#26 Capt. Serious on 05.14.17 at 8:29 pm

That guy stuck in the playground structure is a long bond investor for sure.

#27 acdel on 05.14.17 at 8:31 pm

Good one Garth!

Would have loved to join all of you dog’s at dogapolusa!
Living on the other side of the country is a bummer at times.

#28 slim on 05.14.17 at 8:31 pm

If anyone made sense of Trump’s interview with The Economist, you’re way ahead of me.

http://www.economist.com/Trumptranscript

#29 Tyler on 05.14.17 at 8:43 pm

To Ben and Garth,

Thank you Ben for asking what the rest of us kids wanted to know. And thank you Garth for answering straight and true.

One question though: What is meant by “some hedged” when mentioning US equity 21% and international equity 18%?

#30 Greg on 05.14.17 at 8:44 pm

Any specific ETFS for this recommendation, Garth?

The current recommended weightings: cash, 5%; corporate bond 6%; provincials 3%; short-term bond 5%; high-yield 3%; preferreds 18%; Cdn equity 16%; REITs 5%; US equity 21% (some hedged); international equity 18% (some hedged).

#31 Mark on 05.14.17 at 8:45 pm

“Ben should have bought real estate in 2014. He would be 15-20% towards paying off a property and would be 100-200k ahead in net worth”

In the GTA? Not even close. Prices on individual identical units have not moved forward since 2013. Had he bought in 2014, he would have suffered opportunity costs of a few years of not being invested, plus had carrying and maintenance costs over and above imputed rents. Conservatively he’d probably be in the hole, on a liquidation basis, $30-$50k at this point simply for closing costs, negative carry, bid-ask spreads, and Realtor commissions.

#32 Cottingham a bargain on 05.14.17 at 8:46 pm

#3 Mauro on 05.14.17 at 6:42 pm
Hi Garth

I’m a 37 male not married yet but targeting within 1-2 years.

I hold a job at a big bank pretty secure and make 105,000 with bonus.

I invest in Mutual Funds and ETFs. Balanced and maxed out all registered accounts.

I have no debts and currently live at home rent free. Sold my condo couple years ago and took the profits.

I’ve started to seriously look for a home. Townhouse semi or detached. GTA – Etobicoke, Vaughan or North York. My down payment is $400,000 and I am pre-approved for another $400,000. This scenario will leave me significant savings still.

Doesn’t look like home prices will ever flatline or decline. I know you and other say they will but when how when how?????!!!!!!

I think I’m pretty much screwed for life now. I don’t want a condo again nor do I want to rent.

Perhaps I buy in Bradford. Perhaps I just give up. Perhaps I stop listening to Garth, Ross Kay, Cohodes and Hilliard. Perhaps it is different here. Perhaps that $800,000 run down bungalow in Etobicoke will be 1.2MM next year.

Perhaps I visit a fortune teller.

Oh the despair. It’s consuming. I blame everyone. But I blame myself the most. I should’ve bought. I should buy. And I think I will.
—–
You’re Italian for sure .

#33 Mark on 05.14.17 at 8:47 pm

“If the Chinese yuan keeps on falling in value vis-a-vis the U.S dollar and the Canadian dollar, money flowing out of China into GTA real estate will dry up completely”

Chinese money flowing into GTA real estate to any statistically unusual or meaningful extent? No such thing. Haven’t we been over this many times?

#34 45north on 05.14.17 at 8:47 pm

Shared Services: the government’s central computer services agency — recently estimated that nearly a dozen significant projects are behind schedule, over budget, or both. These include Phoenix and the very late project to upgrade the government’s email system.

the project to upgrade the government’s email system was the reason for having Shared Services! It was supposed to save money. It hasn’t and it won’t. Shared Services’ budget is $1.4 billion a year! The real reason for Shared Services is centralization: senior bureaucrats are assigned more authority, bigger budgets.

This thinking persists: The botched rollout, which technology experts are still trying to rectify, was a stark reminder of how Wernick’s predecessors had failed to equip the public service with the skills necessary to modernize the federal government’s electronic backbone. Unnamed predecessors have failed. They simply had to equip the public service with the necessary skills and they failed.

So what to do? Politically the safest thing is do nothing. After all, if the senior civil service got itself into this mess, it can get itself out. If the Government delegated authority for the various projects back to the individual departments, there would be mass resignations. Careers would be ruined. Also there are billions of dollars of private contracts that would have to be honoured. However, time is running out:
Not surprisingly, the Liberal government is increasingly anxious that this mess be dealt with well before the next general election, scheduled for 2019.

http://ottawacitizen.com/news/local-news/we-need-to-raise-our-game-the-challenges-facing-the-public-service-in-2017

#35 I'm stupid on 05.14.17 at 8:50 pm

#3 Mauro

Stop being a troll… married in 1 or 2 years either means you don’t really want to be married to the person you’re with or you’re single and hope to meet and marry Mrs right. Either way good luck, if you want to see the problem with your life look in the mirror.

If you’re with someone you love grow a pair and man up. You can’t be at home with mamma forever. Dont be afraid to fail or you’ll be afraid your entire life. And do it right, no safety net. Money can always be made trust must be earned. When I got married my wife had total assets of just under 50k I had north of a million. No prenup, still happily married. It’s one thing to say I love you it’s another to give yourself to someone. You need to be all in or it has no chance of working.

#36 Cheap Houses on 05.14.17 at 8:51 pm

#6 jess on 05.14.17 at 7:06 pm
Uncovering More Trump Ties to Mobsters and Shadowy Oligarchs
A Trump Business Partner Threatens to Reveal a Vast Network of Murky Relationships

By David Cay Johnston, DCReport Founder and Editor

“Behar’s DCReport exclusive is a roadmap for Congressional and FBI investigators as well as other journalists. It advances what we expect time will show is the most important story in the history of the United States, the story of how Moscow and Russian money may have helped put Vladimir Putin’s favored candidate in the White House.”
https://www.dcreport.org/2017/05/12/uncovering-more-trump-ties-to-mobsters-and-shadowy-oligarchs/

—–

Try googling and YouTubing the clinton crime family – 1000% more than you will ever find on Trump

#37 Cottingham a bargain on 05.14.17 at 8:54 pm

#24 Shortymac on 05.14.17 at 8:26 pm
I was sad to miss the get together, is there another one in the near future?

I was wondering if now would be a good time to get pre-approved and put in some low-ball offers. See if I can get someone to bargain from 800k to 500k. Might be a tad unrealistic.

Also, Mauro, there’s a house by me near yorkdale mall going for 800k if you want. It’s on realtor.ca (on mobile so no link)
———-

Yup , a plethora of buyers in the sidelines in the GTA looking to do the same thing , hence the reason there will be no significance correction at all

#38 Mauro on 05.14.17 at 8:55 pm

Thanks everyone for the advice and kind words.
Garth has yet to weigh in on my story.
I understand the market may be turning but the boy has cried wolf so many times who knows anymore what will happen.
Perhaps this is the new normal.
And yes I do need to move out.
I would be gone already had it not be so challenging to find a home.
In the meantime I save I invest I travel and I buy the nicer things in life.

Ironically, if the market turns my parents home loses value which impacts future inheritance.

Damned if you do damned if you don’t.

Garth, I’ve never been to Belfountain. Looks nice.

#39 I think I know on 05.14.17 at 8:55 pm

Interest rates are NOT going up. How many times do I have to state the obvious?

#40 Larry1 on 05.14.17 at 8:58 pm

Don’t get to ON much anymore (live in BC now) but I pass by that area on the way to my homeland in Grey County. Next time I’m going by I’ll pickup an ice cream at the general store.

#41 fancy_pants on 05.14.17 at 9:01 pm

Wow, life changing im sure. Now don’t the rest of us all feel sad and left out. not

#42 fancy_pants on 05.14.17 at 9:05 pm

Kidding of course, would gave been cool but I want to make a t-shirt with my online moniker when I show up. And my fancy pants were in the wash

#43 Smoking Man on 05.14.17 at 9:07 pm

“Grup shit!,” SM called out at one point, assembling the nearest bodies around him. There are eight regular bloggers in that picture above. Guess who.
….

You forgot to mention the 100 or so people of to the side on the grass that did not want to be photographed. ..

Lol

Its wierd at first till we all started talking to each other.

Dogs Garth loved having us. Don’t be afraid to visit. He’s a good shit.

#44 [email protected] on 05.14.17 at 9:08 pm

Ok theres always plan b. With the upcoming legalization you could apply for a license and sell. Just don’t mix up the cookies with the biscuits.

Seriously a nice bunch and inviting store !!!!!!

#45 just starting out on 05.14.17 at 9:08 pm

When you get a TFSA, how do you go about choosing what to invest in? This might sound green, maybe totally wrong but I’m heading over to the bank this week to open my first TFSA and everything I read says you get to choose….I’m not sure I want to trust a financial person there, I’d rather come in informed.

I’m hoping putting some newly acquired money in there instead of on a house will be a better idea. I’m in Ottawa. Still not sure the relevance of Toronto for us….

#46 Mark Baum on 05.14.17 at 9:16 pm

#37 Cottingham a bargain on 05.14.17 at 8:54 pm

Yup , a plethora of buyers in the sidelines in the GTA looking to do the same thing , hence the reason there will be no significance correction at all

******

What if these people on the sidelines are unable to obtain financing at current prices?

Woman at the strip club told me she needs to refinance her five houses… and a condo.

#47 S.Bby on 05.14.17 at 9:22 pm

Ben:
XAW and go all in.

#48 Shortymac on 05.14.17 at 9:22 pm

For Mauro: https://www.realtor.ca/Residential/Single-Family/18126062/39-BENTWORTH-Avenue-Toronto-Ontario-M6A1P1-Yorkdale-Glen-Park

Walking distance to subway, prime old school italian neighborhood that’s quiet. Lots of million dollar homes.

#49 dr. talc on 05.14.17 at 9:23 pm

Perhaps that $800,000 run down bungalow in Etobicoke will be 1.2MM next year.

—-

they were 8 a year ago, this year 1.1 m

#50 rosholt on 05.14.17 at 9:27 pm

I was just going to ask a vague question about which preferreds to look at as they seem confusing with all the different letters behind them but I’m going to be blunt and to the point.

Can someone suggest some symbols of preferreds to be looking at. I WILL do my own DD from there if that takes the risk of suggesting some away. THANKS

#51 Cottingham a bargain on 05.14.17 at 9:30 pm

#38 Mauro on 05.14.17 at 8:55 pm
Thanks everyone for the advice and kind words.
Garth has yet to weigh in on my story.
I understand the market may be turning but the boy has cried wolf so many times who knows anymore what will happen.
Perhaps this is the new normal.
And yes I do need to move out.
I would be gone already had it not be so challenging to find a home.
In the meantime I save I invest I travel and I buy the nicer things in life.

Ironically, if the market turns my parents home loses value which impacts future inheritance.

Damned if you do damned if you don’t.

Garth, I’ve never been to Belfountain. Looks nice.
——-

Italian for sure as your universe revolves around the worship of houses. Proof above

#52 akashic record on 05.14.17 at 9:33 pm

#6 jess on 05.14.17 at 7:06 pm

Uncovering More Trump Ties to Mobsters and Shadowy Oligarchs
A Trump Business Partner Threatens to Reveal a Vast Network of Murky Relationships

By David Cay Johnston, DCReport Founder and Editor

“Behar’s DCReport exclusive is a roadmap for Congressional and FBI investigators as well as other journalists. It advances what we expect time will show is the most important story in the history of the United States, the story of how Moscow and Russian money may have helped put Vladimir Putin’s favored candidate in the White House.”
https://www.dcreport.org/2017/05/12/uncovering-more-trump-ties-to-mobsters-and-shadowy-oligarchs/

Thank you for your daily fake news supply on the same topic.

Why don’t you post next time when US intelligence or law enforcement agencies, running the investigations will provide actual evidence?

As of last week, it was stated in sworn testimonies for the Congress: there is no evidence.

http://www.nbcnews.com/news/us-news/clinton-ally-says-smoke-no-fire-no-russia-trump-collusion-n734176

#53 april on 05.14.17 at 9:50 pm

#13 – Listings may have ” exploded” in Toronto but not in the lower mainland of BC. Curious?

#54 akashic record on 05.14.17 at 9:53 pm

#43 Smoking Man on 05.14.17 at 9:07 pm

“Grup shit!,” SM called out at one point, assembling the nearest bodies around him. There are eight regular bloggers in that picture above. Guess who.

===

Where is Waldo… I mean, Gartho?

#55 ShawnG in TO on 05.14.17 at 10:00 pm

Hey Smokey,
meet your match
https://pbs.twimg.com/media/C_1IoYaV0AAd7pH.jpg

#56 akashic record on 05.14.17 at 10:06 pm

#43 Smoking Man on 05.14.17 at 9:07 pm

Dogs Garth loved having us. Don’t be afraid to visit. He’s a good shit.

====

If only the machine hadn’t turn him so liberal… What’s next, free ice cream and dog treats?

As if switching from Harley to Honda wasn’t enough of a horror… If it goes like this, he might even lose his cowboy boots.

#57 Victor V on 05.14.17 at 10:09 pm

#50 rosholt on 05.14.17 at 9:27 pm

I was just going to ask a vague question about which preferreds to look at as they seem confusing with all the different letters behind them but I’m going to be blunt and to the point.

Can someone suggest some symbols of preferreds to be looking at. I WILL do my own DD from there if that takes the risk of suggesting some away. THANKS

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

Go for ETF prefs and you’ll do fine:

CPD
ZPR
XPF

#58 conan on 05.14.17 at 10:12 pm

Who is that drinking the coffee from Tim’s in the second picture? Everyone looks dangerous, no wonder the cops showed.

#59 raisemyrent on 05.14.17 at 10:14 pm

Hey everyone. I read every blog post eventually but the comments now snowball out of control for me so I haven’t commented in ages. Just glad to see everyone had a good time and Smoking Man turned out to have a big heart like we all suspected.
We truly wish we could’ve brought Floyd over to hang out with dogs and dawgs but the drive from Vancouver was prohibitive and he’s too big for the plane. Maybe some other time.
Cheers.

#60 dakkie on 05.14.17 at 10:16 pm

BANK RUN in Toronto! Home Capital Uses Bank Deposits to Fund Mortgage Lending!

http://investmentwatchblog.com/bank-run-in-toronto-home-capital-uses-bank-deposits-to-fund-mortgage-lending/

#61 Timberrr on 05.14.17 at 10:17 pm

No US tax cuts happening with Trump indictments goin down in a ball of flames this week. Just like BC real estate.

#62 Waiverless on 05.14.17 at 10:21 pm

#50 rosholt on 05.14.17 at 9:27 pm

I was just going to ask a vague question about which preferreds to look at as they seem confusing with all the different letters behind them but I’m going to be blunt and to the point.

Can someone suggest some symbols of preferreds to be looking at. I WILL do my own DD from there if that takes the risk of suggesting some away. THANKS

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

Go for ETF prefs and you’ll do fine:

CPD
ZPR
XPF

——————————————–

CPD and XPF I believe have a decent amount of perpetual preferred shares. In a rising rate environment you want rate reset. So ZPR or maybe HPR. I’ve gleaned this from what Garth says and delving into the holdings of a few of them. Do your own research to verify… I could be wrong :)

#63 Smoking Man on 05.14.17 at 10:23 pm

ShawnG in TO on 05.14.17 at 10:00 pm
Hey Smokey,
meet your match
https://pbs.twimg.com/media/C_1IoYaV0AAd7pH.jpg
….

It’s not about the amount of loot you win when gamblING it’s about beating the machine. Bet that dude pays tax on his winnings.

#64 Smoking Man on 05.14.17 at 10:33 pm

#56 akashic record on 05.14.17 at 10:06 pm
#43 Smoking Man on 05.14.17 at 9:07 pm

Dogs Garth loved having us. Don’t be afraid to visit. He’s a good shit.

====

If only the machine hadn’t turn him so liberal… What’s next, free ice cream and dog treats?

As if switching from Harley to Honda wasn’t enough of a horror… If it goes like this, he might even lose his cowboy boots.

Ha ha. Don’t be so hard on garth. He works on bay street. That place has turned into a phyco demasculation shit show.

I would not be suprised if one day in the near future they will have a vigina costume day. All proceeds going to the trans gender aquarium sociaty.

#65 JMS on 05.14.17 at 10:35 pm

No real return bonds?? Although in Canada, I would guess that things are going to get deflationary before they get inflationary…

#66 Ace Goodheart on 05.14.17 at 10:51 pm

A lot of people made a lot of money off the run up. So it’s dangerous. What isn’t? 1/2 taxable capital gains, if you get caught. No automatic deductions. If you’re smart you’ll be offshore before they catch wind. Do you know how many are down in the dirty tropics like kings and queens (you can do that down there, if you have a few mil in the bank, literally).

So the safe ones made 6% balanced and diversified. Good for them.

Yes it’s over and if you got in now, you are going to get flambeyed like a hot dog on the charcoal.

Just remember, when they taxed you as a business because you were buying and selling houses, that river flows two ways. Business income is fully deductible from your T4. When you lose your shirt next year, just call it a fat tax deduction.

After all, buying and selling houses for profit is a taxable business enterprise, isn’t it?

#67 Mark on 05.14.17 at 11:13 pm

“BANK RUN in Toronto! Home Capital Uses Bank Deposits to Fund Mortgage Lending!”

What a misleading headline. Every bank uses deposits to fund mortgage lending. By definition every dollar lent out by a Canadian bank must first have been borrowed from a depositor or a shareholder.

Of course a bank that lends against assets that are simply not worth the value of the loan runs into trouble. As HCG most likely has.

#68 Smoking Man on 05.14.17 at 11:42 pm

The wife filling slot machines with easy money.

She’s a bit plump from the day I meet her when it mattered.

Don’t matter now.

She’s beautiful. All the extra inches are more love for me to enjoy.

Happy Mothers day babe.

#69 jay on 05.14.17 at 11:47 pm

Now its gonna get ugly, lot of in migration, bad government policy leading to lack of housing in Vancouver. http://www.cbc.ca/news/canada/british-columbia/vancouver-condo-market-high-1.4111631

#70 slick on 05.15.17 at 12:02 am

garth; glad you waited until after the cops left before snapping the mug shots. A nice little doo you got roped into. Excellent job refurbishing that old building. Too bad you wasted a pic with that dirty biker in the shot though. That Tucker fella won’t post, but enjoyed the conversation. Pleasant interesting people.
All the best.
slick

#71 Doug on 05.15.17 at 12:10 am

Now the crybaby communist left and SJW want to ban Mother’s Day. I think they have jumped the shark many times over now. Garth- you celebrate Mother’s Day?

#72 jakethesnake on 05.15.17 at 12:50 am

Why is Steve Paikin holding Smoking Man’s ice cream for him?

#73 Alberta Redneck on 05.15.17 at 12:51 am

Hey Garth, you’ve spoken a number of times about the importance of mingling financial fluids, but the implication always seems to be that the hypothetical couple is young and penniless. Would you consider writing about what do to when this happens later in life, where one partner has much more money invested than the other?

#74 Dan.t on 05.15.17 at 1:05 am

Exactly why nothing changes and why nothing will until interest rates rise.

If prices go down, so many Real estate horny Canadians will start fighting with each other again to buy and push prices up again.

Housing is religion in Canada. Nothing else matters. On average every Canadian owns 1,2,3 houses, townhouses or more condos. Well in most cases the bank owns them…

Also…

Since real estate Never, ever goes down, no real estate owner would ever dream of selling for less than they paid. That would be the ultimate sacrilege.

Real estate has proven to be the only way to get rich in Canada and it is now a religious belief for virtually every generation. Nothing will change. Prices will just keep going up.

#75 When Will They Raise Rates? on 05.15.17 at 5:34 am

Germany Confiscating Homes To Use For Migrants

http://www.zerohedge.com/news/2017-05-14/germany-confiscating-homes-use-migrants

#76 Wrk.dover on 05.15.17 at 6:28 am

“Grup shit!,” SM called out at one point….

—————————————

I then anticipated the next thing would be Freedom First, shouting out ” circle Jerk” ! Whew.

also on that note, the google finance page this morning, Poloz states that the HCG problems are resolved…

#77 Dharma Bum on 05.15.17 at 6:47 am

#43 Smoking Man
#63 Smoking Man
——————————————————————-

I don’t know what those pastries were laced with, but all of a sudden Smoking Man knows how to spell.

Hmmmmmmmmmmmmm…………

#78 Stock Picker on 05.15.17 at 6:53 am

#75 Will…..this idea will appeal to Liberal Governments….especially socialist leaning Liberals like Trudeau….who respects nothing about Canada….only seeking his own self aggrandizement for his post PM period in the UN.

Garth, disagree entirely regarding any bond exposure in any portfolio. Bonds are a good way to grow poor. Buy good companies and let them run while paying you a dividend.

#79 MF on 05.15.17 at 7:30 am

Glad to hear the meetup went well. Pictures are great!

My guesses from the first pic:

-Guy in the brown leather jacket and jeans looking down at the dog: Turnernation (looks like he frequent’s King West)
-Lady holding the leash with the dog: Jane 24 (looks like a retired RE agent) or Jess (who I imagine as a woman).
-Guy in the blue shirt and jeans: Ace Goodheart or Cottingham a bargain (looks like a RE owner. Just does).
-Guy in the white jacket in the back smiling: Traderjim (looks like he rents and trades often using his online platform).
-Guy in the back with a wife/woman with him holding the baby: Raisemyrent (Renting but taking flack from wife. Comes on here to complain like the rest of us of missing out and rising rents. Young family).

Am I close?

MF

#80 Mishuko on 05.15.17 at 7:34 am

Thanks for the updated weighting Garth! I need to rebalance.

I think I remember reading before, but just seeking reaffirmation. Is it better to get invested quickly and stay vested than try time your investments to build a portfolio?

#81 MF on 05.15.17 at 7:55 am

From the second pic:

-Guy sitting down with the bandana: IHCTD9 (hard working, conservative values from up north. Friendly)
-Girl with the short hair: Bottomsup (has liberal values)
-Guy with the grey shirt leaning forward: Mark (likes to talk. Looks like an IT guy. Others don’t look really interested or like they agree!)

MF

#82 Julia on 05.15.17 at 7:55 am

I had to miss the get together, child party at home instead, though not sure which one would have been more mature.

Neighbors did sell their house finally. Mid-town Toronto, 12 days, 1 price drop later. 1 offer. Anticipated bidding war didn’t happen. Sold approximately 10% below what similar houses were selling last summer and 15% below what they thought they would get.

#83 Trumpocalypse2017 on 05.15.17 at 8:11 am

Glad for those of you who showed up on Saturday.

The 4:20 meetup Friday was not as big, but very interesting. We shared important survival tips and suggestions for investing in times of global war.

We just barely avoided a nuclear conflagration, thankfully.

http://www.reuters.com/article/us-northkorea-missiles-idUSKCN18A12B

I’ll be back south soon, but have my retreat now fully stocked.

As soon as Trump panics enough to think he is in really deep sh*t, he will press the trigger.

Coming soon.

#84 NoName on 05.15.17 at 8:13 am

#75 When Will They Raise Rates? on 05.15.17 at 5:34 am

That is old news, same thing is happening all over eu, rec. propertys are kind of being appropriate ed to house, because that is only empy thing left… It’s unfortunate that germany feel on its own sword there…

At begging there was as greece struggled with it’s social programs and unable to repay its loans, and EU sad to them (grek) house all this displaced people and we will bail you out and figure​it something out, so time passes and mer kel gets nevous about German banks, and tells greace we don’t care that surgion lost 60% of it’s income and that pension is cut to 50% (or something along those lines) cut benefits more and pay us now.

Greece pm in a eu parlament told them if we do what you people are asking from us, we won’t have money to house all those displaced people, than mer kel sad samting like we do care they are your problem.

and after that we know what happened, greece was made an example of to send msg to pis what could happen if they don’t pay up, and we know what happened after that.

Sounds like I made all this, but I didn’t, everything in on a public record and on youtube.

Plus there was that dude who made a killing shorting greece bonds.

#85 jess on 05.15.17 at 8:18 am

intriguing

as comey said: the investigations are ongoing

https://www.ft.com/content/33285dfa-9231-11e6-8df8-d3778b55a923

Kazakh billionaire to be extradited over alleged £3bn fraud, French …
https://www.theguardian.com › Business › Kazakhstan
Jan 9, 2014 – Ablyazov, 50, who is accused of embezzling £3bn from the state-owned Kazakh bank BTA, was found guilty of contempt of court in London for …

Kazakhstan: California Court to Hear Almaty Corruption Lawsuit
April 1, 2017 News

https://www.interpol.int/notice/search/wanted/2014-26980

offshore mailboxes?

http://kazworld.info/?p=36673

#86 Herb on 05.15.17 at 8:21 am

A plenary meeting with group picture of the Smoking Man Fan Club.

#87 Mortgage Fraud on 05.15.17 at 8:38 am

$5 Billion of fraudulent mortgages on the dirty books of HCG. Turtle Creek and CIBC aware of this. Poloz knows it too. And yet Poloz declares all is well. And that, ladies and gentlemen, is all you need to know. Buckle up.

#88 Mortgage Fraud on 05.15.17 at 8:42 am

Many of the fraudulent mortgages held by HOOP members. Truth is slowly coming out… Those mortgage brokers who were let go, were not imprisoned, fined, or even officially identified. We do know some of their names, but they are still out there, wielding their craft.

Everything HCG releases to the press is a lie. Insiders don’t even own any significant amount of shares and are also probably shorting it!

#89 Preferred shares etfs on 05.15.17 at 8:45 am

This is a sector play. Elite management will comfortably beat an etf

Look at redwood and compare to cpd.

#90 maxx on 05.15.17 at 8:53 am

“…….Perhaps I visit a fortune teller.

Oh the despair. It’s consuming. I blame everyone. But I blame myself the most. I should’ve bought. I should buy. And I think I will.”

Perfect example, or a shill? Nevertheless:

Realtards lap up this common, goggle-eyed, crazed, biding-war-producing outburst with jaws wide open, whilst belly-laughing and yanking every nickel they can out of wallets.

Did I say laugh? All the way to the bank with yet another major confidence-boost that their decree on re pricing is the only one that matters. This useless, meddling, middleman industry has distorted re pricing to the point of destroying the economy.

Canuckleheads are incomparable re addicts. They, along with gubbmint are enabling FIRE to carry on driving the real economy into the ground.

Oh……too late.

Flush the realturds, I say.

#91 Happy Housing Crash Everyone! on 05.15.17 at 9:02 am

Nothing is selling and speakers, realtors and mortgage brokers are in an all out panic. Game over shysters its going down hard. Nothing is selling and i hear HELOCs are getting called in. Happy Housing Crash Everyone! :-)

#92 Grey Dog on 05.15.17 at 9:04 am

Hi Garth, thanks for hosting Blog dog Palooza, could not believe all the cops when we first arrived, were they expecting a Dog rampage versus a civilized meet up? We loved the live music, and now we know you serve milkshakes, we will have to bring my mom up when the weather warms up.

Thanks for your blog, and letting us speak up, it seemed everyone I spoke to are lurkers, SM your dogs are too cute, loved meeting the energetic Boston Terrier, of course mine is the Grey Dog minature schnauzer.

Once again Thanks Garth, you have done an exquisite job restoring a historic landmark!

#93 James on 05.15.17 at 9:28 am

#43 Smoking Man on 05.14.17 at 9:07 pm

“Grup shit!,” SM called out at one point, assembling the nearest bodies around him. There are eight regular bloggers in that picture above. Guess who.
……………….
You forgot to mention the 100 or so people of to the side on the grass that did not want to be photographed. …………………
Lol
Its wierd at first till we all started talking to each other.
Dogs Garth loved having us. Don’t be afraid to visit. He’s a good shit.
………………………………………………………………….
Glad everyone had a good time. I think I would have enjoyed coming to the dog meet but dragging a 2 year old a 4 year old and a 7 year old would not have worked out for me. I’m sure your photos were as good as the National Park service Smokie.

https://www.usatoday.com/story/news/politics/onpolitics/2017/03/06/park-service-inauguration-photos/98834960/

#94 Pete on 05.15.17 at 9:31 am

Home Capital’s GIC dropped $47 million on the latest day May 12th. From May 1 to May 12, GIC dropped $310 million, among which, only $120 million is cashable GIC. Looks like most people choose not to renew their GIC.

Home Capital is saved? I don’t think so.

#95 The Technical Analyst, CSTA, CPD on 05.15.17 at 9:48 am

Ben,

First and foremost: DO NOT LISTEN TO ANY ADVICE TILL YOU HAVE DONE A RISK ASSESSMENT TEST.

Many a client will blinding invest in what their good-hearted advisor tells them, but the most important part of investing is: HOW YOU FEEL.

My investment risk profile is: BALANCED

But that may not be YOUR risk profile. Maybe it’s conservative, maybe it’s GROWTH. Following investment advice on any blog/internet is foolish without your own due-diligence.

Garth’s model portfolio is more Balanced Growth (with the high amount of preferreds), you are happy with a 6-7% return with a 16-20% loss?

Not everyone HAS to make a higher return %. You only need to get rich ONCE. It is keeping it that is important.

#96 traderJim on 05.15.17 at 9:52 am

No time for a scientific study, but just looking at realtor.ca each day shows listings growing at a few hundred a day. That doesn’t seem to be outside of normal spring numbers, although I suppose realtor.ca is not exactly a good database.

Still wondering if anyone knows what a ‘normal’ number of GTA listings is? This data is not easy to find, I wonder why…

I imagine everyone who wants to list will do so before summer. So the peak should be from now until July 1.

After that the hordes will descend on ‘my’ lake, goddamit. Good thing they only stay 2 months, then leave the fabulous fall months to me and a handful of other diehards.

#97 badbadnotgood on 05.15.17 at 9:56 am

#3
Mauro is a dink. The sob story that he’s sittin on few hundred large and his life is over cuz he doesn’t own real estate is just an indulgence. And I don’t say that to reassure him. I just think his post is embarrassingly stupid and he’s a dink.

#98 S.Bby on 05.15.17 at 9:57 am

A pissed off real estate agent must have tipped off the cops that there was going to be a rumble or something at the General Store. Realtors can get ugly when things begin to go sideways for them.

#99 Pete on 05.15.17 at 9:58 am

It is true that HCG’s GICs are mostly nonredeemable, but they are also very short-term, mostly 1 year GIC.

#100 traderJim on 05.15.17 at 10:09 am

#79 MF

I think you probably made some good guesses, but I wasn’t there. I was helping my buddy get his house ready to list. All out race to get it finished in time for staging and photos.

Only one in the pics I would recognize is Smokey of course.

Everyone I am sure are all even nicer in person than online. Anonymity lets us say what we really think and be a-holes for a while, which is kind of a nice relief from real life behaviour.

(So probably better I didn’t attend. After I met people I’d have to be nice to them. That would be boring.)

#101 traderJim on 05.15.17 at 10:15 am

#99 Pete

I agree completely re: HCG. They are done, just a question if they get bailed out or, much more likely, they get bought out at a huge discount by another player (who later regrets it).

I can’t see who in their right mind would keep money with them, even for a day.

Although, I have often been surprised what massive risks some fools are willing to take for an extra 25 bps.

#102 Fed-up on 05.15.17 at 10:27 am

#75 When Will They Raise Rates? on 05.15.17 at 5:34 am
Germany Confiscating Homes To Use For Migrants

http://www.zerohedge.com/news/2017-05-14/germany-confiscating-homes-use-migrants

The Germans have lost their collective minds.

#103 Stan Broock on 05.15.17 at 11:14 am

#87 Mortgage Fraud on 05.15.17 at 8:38 am
$5 Billion of fraudulent mortgages on the dirty books of HCG. Turtle Creek and CIBC aware of this. Poloz knows it too. And yet Poloz declares all is well. And that, ladies and gentlemen, is all you need to know. Buckle up.

—————————–
The guy said 3 years ago publicly that (at that time, in 2014) real estate is overpriced 30 % in Vancouver and GTA.

Since then prices have risen by another 40 % in GTA.

And now the guy is saying there will be no major price correction.

https://ca.finance.yahoo.com/news/home-capitals-problems-contained-bank-020446327.html

When contradicted by the media he said that he does not believe his own numbers from 3 years ago.

The guy is just making it ad-hoc hoping that things will somehow work out itself.

Absolutely scary situation. He can not even lie convincingly. Nobody knows who saved HCG and what was the price paid for their mortgages. 100 % of the value of their mortgages? Or 80 %?

It (the details) makes all the difference in this case.
As always we prefer to present there is no problem and to lie and hide.

I am very, very scared.

#104 For those about to flop... on 05.15.17 at 11:16 am

As I was cleaning up some deadwood out of my folders on the weekend I saw that few of my old Pink Snow cases had been finalized.

I have not been spending as much time lately looking into the condo market, but I know through talking to Broadway there are some future cases waiting to be finalized where the owners took significant loses percentage wise on condo sales that might surprise a few people.

Anyway below are a few cases where it seems the sellers basically split the expenses with the buyers and perhaps a small loss was recorded.

Make of it what you will,but I thought it was a bit of a surprise as we are told that the condo market is on fire but it seems mainly to me that pre-sales are still seen as can’t lose in the current environment and if you overpay for a 40y.o condo like the first guys did there might be better investments out there for you…

M42BC

223-7055 Wilma Street, Burnaby paid 333 sold 346 3.9%

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDAzV0Q3OQ==

126-9333 Tomicki Ave . Paid 515 Sold 535 3.9%

https://evaluebc.bcassessment.ca/Property.aspx?_oa=RDAwMDBTUzdKTA==

These guys bought this condo for 643k in July 2016 and must of gotten spooked and offloaded it for 658k in December 2.8%

6003-5511 HOLLYBRIDGE WAY RICH.

https://evaluebc.bcassessment.ca/Property.aspx?_oa=RDAwMDBOQjRXVw==

#105 Mortgage Fraud on 05.15.17 at 11:41 am

The bank run on HCG was done by financial advisors on behalf of their clients to qualify under the CDIC 100K limit! These were not Grandma and Grandpa withdrawing their savings, contrary to the claims of Brenda Eprile ‘n the Gang. More truth leaking out. Poloz claims paraphrased: “Subprime has been contained”. According to CIBC 30-50% of the Canadian market is subprime, and HCG has only 5% of it. That means more cockroaches to be found as we go along. Systemic risk on. Barry Schwartz of David Baskin Wealth Management April 17th on BNN. A clown that shouldn’t be managing anyone’s money.

http://www.bnn.ca/investing/video/barry-schwartz-discusses-home-capital~1102600

#106 Alex N calgary on 05.15.17 at 11:42 am

Smoking man is the worst, drunken rants, pages long, nothing useful in there, I suppose that makes him interesting? I would have shown up for the sandwhiches and ice cream and curiousity for sure!

CBC ran some articles on how cheap it is to Shale Frak in Texas, nothing new here for Alberta where new wells aren’t coming back. Likely the pullout will continue, orphan well money will dry up, tax payers on hook (and for sour gas plants with bankrupt companies, that could kill us all around here)

Nobody here has any clue really, I was talking to some downhill mountain bike girls on the weekend about it, BUT weirdly enough they knew about the Bubble now, mainstream right? My friend at Home Capital still doesn’t say much, I forgot he used to sell GIC’s there, had some server upgrades on the weekend they were doing, I joked that database goes down friday, 100 Mil in Sub prime mortgages on the books, saturday they come up and liabilites are missing.

But in reality CMHC is on hook right? Can we explore why people are making such a run on home capital? Thanks!

#107 Capt. Serious on 05.15.17 at 12:05 pm

#62 Waiverless on 05.14.17 at 10:21 pm
#50 rosholt on 05.14.17 at 9:27 pm

CPD and XPF I believe have a decent amount of perpetual preferred shares. In a rising rate environment you want rate reset. So ZPR or maybe HPR. I’ve gleaned this from what Garth says and delving into the holdings of a few of them. Do your own research to verify… I could be wrong :)

CPD is 70% rate resets:
https://www.blackrock.com/ca/individual/en/literature/product-brief/cpd-characteristics-en-ca.pdf

#108 For those about to flop... on 05.15.17 at 12:12 pm

Pink Pollen falling in Delta.

These guys have moved into Pink Pollen territory with their latest reduction.

They forked out 1.24 last Spring and the assessment that came out later in the year despite rising by a bumper 50% failed to cover their number.

There is a 20% spread between all the cities that make up Greater Vancouver year over year average sales prices ,but as far as these guys are concerned Delta is one of the worse off ones at a mild but concerning minus 6.5%…

M42BC

11231 64a Avenue, Delta

Oct 15:$1,368,000
May 14: $1,299,000
Change: – 69000.00 – 5%

https://www.zolo.ca/delta-real-estate/11231-64a-avenue

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA1VkJVUg==

#109 Keith in Calgary on 05.15.17 at 12:14 pm

#105 Mortgage Fraud………

IMHO it is much higher than the 30-50% claimed in your post if that is accurate, as you provide no verifiable source.

In my opinion, if you required CMHC insurance, or any other third party mortgage insurance, regardless of your credit worthiness……..you have become a “subprime” borrower. So, that probably puts the percentage much, much, higher.

#110 Wrk.dover on 05.15.17 at 12:27 pm

HCG saga is not real MSN public knowledge…I mean it would be very easy for the average person not to be aware of the situation. No mention on CBC TV that I have observed. Google finance page is not where many travel, and the google news page mentions are quite few and benign. I can well imagine many have GIC’s there yet, that are completely unaware.

I have always been under the impression that a non-redeemable GIC can be cashed out at any time with out the interest for that period. How wrong am I?

#111 Stan Broock on 05.15.17 at 12:52 pm

https://ca.finance.yahoo.com/news/canada-home-resales-fall-april-131537772.html

OTTAWA (Reuters) – Canadian home resales fell in April as a government move to cool the long housing boom sent buyers to the sidelines and sparked a spike of new listings, the Canadian Real Estate Association said on Monday.

Sales dropped 1.7 percent in April from March’s record level while listings rose 10 percent, the industry group said. Prices, which take longer to adjust, were up 19.8 percent from a year ago, according to the group’s home price index.

The sharp slowdown was led by Toronto, Canada’s largest city and the capital of the province of Ontario, where months of double-digit appreciation had sparked fears of a bubble.

The Ontario government in April imposed a 15 percent tax on foreign buyers, among other measures, in a bid to cool the market, as happened in Vancouver last August when a foreign buyers tax was imposed there.

Toronto sales fell 6.7 percent and listings surged 36 percent, CREA said. Listings in Ontario more broadly surged 21.6 percent, the biggest monthly increase since 1989 – the last time the Canadian housing market saw a dramatic slowdown.

“It suggests these housing markets have started to cool,” CREA Chief Economist Gregory Klump said in a statement, referring to a spike in new listings in and around Toronto and far-flung suburbs that had benefited from a spillover effect.

#112 Mark on 05.15.17 at 1:04 pm

“I have always been under the impression that a non-redeemable GIC can be cashed out at any time with out the interest for that period. How wrong am I?”

Very wrong. A non-cashable GIC is exactly that, non-redeemable. The issuer can decide to redeem it, at their discretion, but there’s nothing that states that they have to give you interest or even the full face value for the obligation. If you can find someone to buy it on your own, then that will allow you to get your money out of it. But other than that, there is no right of redemption from the issuer prior to the maturity date on a “non-cashable” GIC.

Before accepting an issuer’s offer for early redemption, my suggestion would be to check with a local deposit broker if this is the situation you’re in. They might be able to place the obligation with a customer of theirs at a better deal (to you) than receiving a significant early termination discount. Of course if its HCG paper, nobody’s probably interested in touching it at this point.

#113 For those about to flop... on 05.15.17 at 1:07 pm

I perhaps should have pointed out in my post at # 108 that if you look at the original date that they put it on the market they have now been slogging along for 7 months now trying to get their money back .

This is the case for a lot of my Pink Snow/Pollen cases.
They are stuck in limbo waiting for the market to explode again but this spring has a different feeling than the last.

The elderly neighbor that I told you about and showed you a photo from the ghost town open house did not even bother with an open house on the weekend despite it being one of the lower houses for sale in Vancouver proper at 1.3m.

Still for sale ,just no traffic.

I’m expecting a developer to buy it for somewhere around 1.2m…

M42BC

#114 Mark on 05.15.17 at 1:10 pm

“-Guy with the grey shirt leaning forward: Mark (likes to talk. Looks like an IT guy. Others don’t look really interested or like they agree!)”

Nope, not me, wasn’t anywhere near the GTA last weekend. Spent a load of time there in March, was quite enough I must say.

I do drive to Guelph through Acton every year or two though. Maybe I’ll have to take a slight detour some summer.

#115 jess on 05.15.17 at 1:18 pm

no insurance payouts when:

What is Mortgage Fraud?

Mortgage fraud occurs when someone deliberately misrepresents information to obtain mortgage financing that would not have been granted if the truth had been known. This can include:

Misstating your position or inflating your income or length of service at your job.
Stating you are a salaried/full time employee when you are a contract, part time, hourly or commission-based employee or are self-employed.
Misrepresenting the amount and/or source of your down payment.
Purchasing a rental property and misrepresenting it as owner-occupied.
Not disclosing existing mortgage and/or debt obligations.
Misrepresenting property details or omitting information in order to inflate the property value.
Adding co-borrowers who will not be residing in the home and do not intend to take responsibility for the mortgage.
…read more @cmhc

=============
This T.O. dispute sounds like:
http://www.theglobeandmail.com/real-estate/condo-board-battle-string-of-disputes-raises-questions-about-elected-directors/article34985050/

department of justice HOA fraud (Home owners association)
Updated March 28, 2017 – 10:13 pm
https://www.justice.gov/opa/pr/fourteen-defendants-plead-guilty-their-roles-scheme-fraudulently-control-home-owners

https://www.justice.gov/criminal-vns/case/hoa-cases_benzerl
from 2010
https://www.reviewjournal.com/crime/courts/elite-unit-running-hoa-fraud-investigation/

“Lugo admitted that he and his co-conspirators employed deceitful tactics in their attempts to win the board elections, including creating false phone surveys to gather information about homeowners’ voting intentions, using mailing lists to vote on behalf of out-of-town homeowners unlikely to participate in the elections, and submitting fake and forged ballots. Co-conspirators also hired private investigators to find “dirt” on the bona fide candidates in order to create smear campaigns. Lugo also admitted that he assisted in sending forged out-of-town homeowner ballots from California to Nevada to make it appear that the ballots were completed and mailed by bona fide homeowners residing outside Nevada.

https://www.justice.gov/opa/pr/sixth-guilty-plea-connection-scheme-fraudulently-control-condominium-homeowners-associations

#116 For those about to flop... on 05.15.17 at 1:24 pm

It’s probably a good thing that I did not attend the get together on the weekend, as I’m sure the police would have not been the only people called in.

I’m sure someone would have placed a called to the zookeepers from the Toronto Zoo ,as I have a head on me like a monkeys bum…

M42BC

#117 Mortgage Fraud on 05.15.17 at 1:28 pm

#109 Keith in Calgary
Good question. The Toronto Star on May 12. The newspaper is quoting a Home Capital executive. But I believe it was also in a report by CIBC.

Anyway, here is the problem now. Virtually all of the fraudulent loans originated by HCG were bundled and securitized and INSURED by CMHC. Ooops… Here is Van Siddall claiming it’s no big deal:

http://www.cbc.ca/news/business/shadow-banking-such-as-subprime-mortgages-growing-but-still-a-tiny-slice-1.2962325

Had anyone seen this from #REwoman two months ago? “So why is it that 132k over asking doesn’t have me doing a happy dance? Because it isn’t about the money right now. It is actually about what is going to happen to this market because surely it cannot continue like this.”

https://www.linkedin.com/pulse/why-am-i-celebrating-michelle-makos

#118 Musty Basement Dweller on 05.15.17 at 1:44 pm

Until rates go up (to counter the out of control debt) and/or the Canadian dollar rises again (to counter the legal infusion of foreign capital transfers from numerous countries) there will be no remarkable changes in the Vancouver and Toronto bubbles. Wish I would have known this 8 years ago. I missed this along with many on this blog. Not much danger of either of these factors kicking in soon, for those who may be waiting to vultch.

#119 Waiverless on 05.15.17 at 1:45 pm

#107 Capt. Serious

Thanks for sharing that document. CPD seems like a pretty good choice too then. Glad I put that disclaimer in to do you’re own research :)

#120 Stan Broock on 05.15.17 at 2:07 pm

#109 Keith in Calgary on 05.15.17 at 12:14 pm
#105 Mortgage Fraud………

IMHO it is much higher than the 30-50% claimed in your post if that is accurate, as you provide no verifiable source.

In my opinion, if you required CMHC insurance, or any other third party mortgage insurance, regardless of your credit worthiness……..you have become a “subprime” borrower. So, that probably puts the percentage much, much, higher.

—————————-

So how would you maintain a highly leveraged Ponzi scheme that already has high participation?

1. make entry into the Ponzi easier
– lower further interest rates
2. insure more subprimes as no banks will lend 80-90 % of the mortgages issued and insured in the last 5-6 years if on the hook for those loans.
3. Spin positive news only – e.g. no price crash expected, just 0.0001 % drop in prices
4. Do not disclose any relevant information on the state of the markets
5. Act in secrecy claiming that it is the market that helps hopeless cases like HCG, not you.
6. Lie that low rates are not related to high prices and that everything is in order, markets are stable.

6. When SHTF (inevitable in all Ponzi schemes) blame someone else, e.g. speculators.

7. Retire with nice government salary and publish memories on how (secretly) you saved Canadian and world financial markets with your brilliance and creative thinking.

#121 Stan Broock on 05.15.17 at 2:09 pm

publish memoirs.

#122 Ronaldo on 05.15.17 at 2:18 pm

Well, just rec’d the stats for Nanaimo real estate. Seems prices have risen 16% over the past year for average single family homes. That’s decent.

As of end of April inventory for SFH was 277 with 1606 having been sold over past 12 months for average price of $461,600. Apt. style condos inventory 55 , 412 sales, price $262,200. Townhomes, inventory 31, 274 sales, price $289,500.

I suppose a lot of the sales would be to boomers retiring here from across the country and people cashing in their lottery tickets in lower mainland where they can by a great home for the price of a down payment on a Vancouver tear down. All in all, a pretty balanced market considering the inventory.

#123 Mortgage Fraud on 05.15.17 at 2:26 pm

Steven (Subprime) Smith of $FN and $EQB needs jail-time. Using taxpayers to backstop his fraudulent mortgage schemes. CEO of a publicly-traded mortgage company while at the same time an owner of a private mortgage insurance company. hmmm

#124 Smoking Man on 05.15.17 at 2:38 pm

Penny Henny

Any updates , what’s going on out there?

#125 Dan.t on 05.15.17 at 3:01 pm

Is Poloz for real? https://ca.finance.yahoo.com/news/home-capitals-problems-contained-bank-020446327.html

“Often, when you have a truly unsustainable housing market, you will see very rapid price increases (and) very rapid credit growth,” Poloz said. “But we don’t see that in the credit side, so I do think a significant amount of this that is fundamental, but layered on top, is a speculative element.”

Everything is cool, nothing to see here. Canadians only have 2 trillion of personal debt outstanding….but on the credit side, that has no relation to unaffordable and bubble house prices…no wonder Canadians think debt is money. Anyone with a heart beat gets credit shoved down their throat.

This guy is the finance minister… was he one of the 60% who can’t explain how interest rates and debt are correlated?

#126 Once a boss, always a boss on 05.15.17 at 3:06 pm

@ 116 For those about to flop

You claim to have a head like a monkey’s bum, but your housing status updates are golden. All brilliant men are denied good looks by the gods on high, so that their thoughts and words are given more weight.

Socrates – another self-proclaimed monkey bum – is one of the great independent human thinkers of human history. But like all independent men of great courageous, he was eventually condemned to death for making the smaller minds around him feel too uncomfortable.

But don’t worry, we won’t make you drink hemlock….so long as you keep up with the housing updates!

#127 Stan Broock on 05.15.17 at 3:12 pm

http://www.cbc.ca/player/play/2652218672

scary. The guy is an idiot, or just a good lair (Goldman Sacks school)

having 2 mil $ homes insured by CMHC as ‘affordable housing’ apparently is government policy.

The guy speaks about not worrying about mortgages that he insures as they are definitely solidly underwritten.

If they are solid why would they need insurance in first place?

The risk to taxpayers is remote.

Our BOC leadership is great.

scary.

#128 Stan Broock on 05.15.17 at 3:15 pm

CMHC CEO Evan Siddall actually said:

1. Resilience in the system is due to the bail in legislation that we introduced to ensure no run on the banks occur.

2. We don’t know what the next crises is going to be

Wow!

If he said that, we’re all in worse shape than thought. Link? — Garth

#129 Rob on 05.15.17 at 3:24 pm

Garth,
I live in Burnaby, This morning, a realter knocked on the front door. She is actually going door to door trying to sell a house.
Is this weird?

#130 Rob on 05.15.17 at 3:26 pm

oops – meant “realtor”

#131 Belfountian dog post on 05.15.17 at 3:43 pm

#92 Grey Dog on 05.15.17 at 9:04 am

Hi Garth, thanks for hosting Blog dog Palooza, could not believe all the cops when we first arrived, were they expecting a Dog rampage versus a civilized meet up? We loved the live music, and now we know you serve milkshakes, we will have to bring my mom up when the weather warms up.

Thanks for your blog, and letting us speak up, it seemed everyone I spoke to are lurkers, SM your dogs are too cute, loved meeting the energetic Boston Terrier, of course mine is the Grey Dog minature schnauzer.

Once again Thanks Garth, you have done an exquisite job restoring a historic landmark!
*******************************************
Ha looks like it was a good time. BTW Smoking Man those aren’t dogs they look like rats dressed ups as dogs. Jesus man I thought you at least had real man dogs. I would have expected at worst a mongrel junkyard dog.

#132 For those about to flop... on 05.15.17 at 4:19 pm

Pink Pollen falling in Delta.

Here is another one that does exactly what another poster complained about the other day,lowered the price down to the favourite asking price of roughly 7% above what they bought it for to try and save face and make the new buyers pay for all expenses.

These guys signed on the line for 1.6m last spring and despite the assessment coming up a massive half a million dollars, it still was well short of their number for this 70s build.

If these guys paid for the full renovation then they are already hooped ,but it might had already been done when they picked it up and encouraged them to overpay.

You have to really want to live out that way to pay that sort of money for an old house south of the Fraser as you can find a decent house in East Van or Burnaby for the same money…

M42BC

5013 1 Avenue, Delta

Mar 14:$1,828,000
May 14: $1,728,000
Change: – 100000.00 -5%

https://www.zolo.ca/index.php?sarea=5013%201%20Avenue,%20Delta&ptype_condo=1&ptype_house=1&ptype_townhouse=1&filter=1

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA1VkxEQg==

#133 SimplyPut7 on 05.15.17 at 4:24 pm

There was an interesting remark made by Home Capital Group, board member Alan Bidden today on BNN at 7:25 min:

“The market is much deeper than people give it recognition for, it’s not just equitable and home capital, there are a lot of other sources of financing, most of them private and non-regulated…”

http://www.bnn.ca/video/first-on-bnn-how-home-capital-is-planning-to-regain-investor-confidence~1123769

Does he mean syndicated mortgages? Where retail investors took money from their home equity line of credit to give to high risk borrowers and haven’t seen a return and are suing the borrowers for millions?

http://www.cbc.ca/news/canada/toronto/syndicated-mortages-1.4078124

http://www.cbc.ca/news/canada/toronto/syndicated-mortgages-losses-1.4083261

#134 Rexx Rock on 05.15.17 at 4:28 pm

Vancouver house up for 2099 bitcoin.This is the future for some investors.Our beloved goverment and our central bank will keep this ponzi scheme going for a long time.Emergency interest rates for 8 years,give me a break.

#135 Grey Dog on 05.15.17 at 4:28 pm

MF, I’m the lady with the grey dog on a leash, definitely retired, never been in real estate, I’m the one always complaining about vacant homes in Unionville. I was hoping to meet AK, as he always has newspaper articles detailing this blight on a wonderful community.

I also am the one advocating to the young blog pups to SAVE and INVEST today for the retirement years so one can live in comfort. I’m also the one that has no shame when I say I EMPLOY a financial advisor.

#136 Robert White on 05.15.17 at 4:36 pm

So, did any of those sunshine list Ontario Provincial Police purchase any ice cream for their K-9 Units back home at the station, or were they just there to keep tabs on the calories being ingested by the bowsers & their chief executive officers on the opposite ends of the leash?

RW

#137 Xbox Economist on 05.15.17 at 4:49 pm

#133 SimplyPut7

Close. He’s talking about MICs and other private corporations that provide lending to borrowers even HCG wouldn’t touch. HCG acts as a facilitator in providing liquidity in the shadow mortgage market (which is completely unregulated). I’ve been commenting on this for months but no one is paying attention. Most people will completely miss the relevance of Alan’s statement.

#138 Re, Stan Brook @ 128 on 05.15.17 at 5:01 pm

Quote please! I did a search and found no such statements.

If you are lying to us, I’ll attack you and a slightly bruised cucumber

#139 Blake on 05.15.17 at 5:09 pm

Hey don’t forget to buy some BITCOIN

#140 SimplyPut7 on 05.15.17 at 5:15 pm

#137 Xbox Economist on 05.15.17 at 4:49 pm

Gawd, you mean there are mortgages to borrowers even Home Capital would not touch?!

When does this all blow up then?

#141 bdwy sktrn on 05.15.17 at 5:21 pm

#135 Grey Dog on 05.15.17 at 4:28 pm
MF, I’m the lady with the grey dog on a leash,

————————
other than SM , you are the only one that jumped out at me . you did have a grey dog!

someone else mentioned it but for sure next to sm is turnernation in his slick city threads. (you overaged hipster types (my bro included) make me chuckle, but you seem to be having alot of fun)

who are the two guys between grey dog and sm?

if that pic was in BC there would be a lot more gore tex.

hope y’ll had fun.

#142 jess on 05.15.17 at 5:47 pm

O’ the humanity!

operation jonny

Mercy” is a major national organization that runs migrant centres and provides other volunteer services around the country.

Investigators said “Mercy” subcontracted catering services to companies run by the Arena clan, which allegedly skimmed some $53.9 million Cdn of the $154 million in public funds destined for migrant care at the centre between 2006 and ’15.

Part of the scam involved putting in for more meals than were actually provided, and then pocketing the money to buy real estate, fancy cars and luxury boats, said Catanzaro prosecutor Nicola Gratteri.

“Operation Jonny,” was the second major investigation into the lucrative business of caring for migrants: In 2015, police in Rome arrested 44 local politicians and businessmen accused of forming a network that rigged public contracts to provide services for migrant holding centres in the Italian capital.

#143 Wicked as it seems on 05.15.17 at 6:08 pm

The guy in brown jacket on Garths left, I’m calling freedom First. Looks a little OCD!

#144 Grey Dog on 05.15.17 at 6:37 pm

141 Bdwy, I believe gentleman sitting is a learn and lurker, I met a couple authentic lurkers who like me have learned much from Garth and the Dogs.

Don’t worry, Goretex was in the car and absolutely necessary at dinner time.

#145 Eco Capitalist on 05.15.17 at 7:21 pm

@141 bdwy sktrn, I’m the guy sitting on Smokie’s right.

Thank you Mr. Turner for allowing us to invade your space for a little while.

#146 maxx on 05.15.17 at 7:33 pm

Re #128:

https://www.cdhowe.org/speeches-and-presentations/remarks-evan-siddall-president-and-chief-executive-officer-canada-mortgage-and-housing-corporation

About 2/3 of the way down…..14 March, 2016.

“We don’t necessarily know what the next crisis will bring.”

#147 Abomb on 05.15.17 at 7:35 pm

Garth, for us dummies can you explain exactly how to “hedge” and why? I mean, explain like were 5. What do we physically have to do… purchase this ETF over the other? Buy USD? Thanks!

#148 Doug heffernan on 05.15.17 at 9:29 pm

147 Abomb
Garth won’t answer that. Being mysterious and keeping you somewhat in the dark is how he gets clients.

It is unprofessional and unethical to suggest securities to someone I have never met and know nothing about. Grow up. — Garth

#149 The Arctic Gringo: Qalunaaq on 05.15.17 at 10:40 pm

One canine and feline(!cursed) mugshot at: https://www.realtor.ca/Residential/Single-Family/18120643/260-BINBROOK-Road-GLANBROOK-Ontario-L0R1C0.

It’ll be tough getting the smell out.

#150 foreign buyers on 05.16.17 at 12:05 pm

Check out this ad in Hong Kong… for Toronto condos. Developer pays the foreign buyers tax!
http://i.imgur.com/hMZvM3J.jpg

#151 Vangordo on 05.16.17 at 12:19 pm

http://www.vancouversun.com/Business/9871711/story.html

More surprises for BC condo market.

#152 FCU on 05.16.17 at 4:35 pm

Smoking Man, no worries about disclosing your name.

That’s nothing, compared to Bell Canada

https://news.slashdot.org/story/17/05/16/1628249/19-million-bell-customer-email-addresses-stolen-by-anonymous-hacker