Evolution

Oh my.

On the weekend, when I paused this blog to mark Remembrance Day and mentioned a poppy-selling old soldier I’d encountered, several moisters were wounded in the crossfire. My sin was mentioning that the wrinkled warrior was standing amidst a swirl of people obsessed with their phones. They were, said I, Millennials. Which they were. But making such an observation today is like telling a female co-worker she looks beautiful this morning. Soon you’re sitting in HR accused of assault.

In this case I was labeled paleo.

Fortunately, I don’t care. So let’s continue. Just as Boomers won the birth lottery, had prosperity showered upon them, then squandered most of it, the moisters are on a different but equally misguided path. They’ve drunk the real estate Kool-Aid, embraced life-threatening levels of debt, are weirdly risk-averse and trust an algo with their money more than a person.

Robo-advisors are the latest manifestation. There are more of them all the time as the FinTech wave sweeps across the money business. The idea is simple – throw your savings into an account managed by code, which will pick a few ETFs based on a 30-second risk assessment quiz, then periodically rebalance and charge you peanuts – maybe half a per cent annually of what you invest.

The latest stats show about half the Mills are comfortable doing this, compared with 27% of GenXers and just one in five Boomers. Surveys also show, however, that three-quarters of these young investors actually have no idea what they’re buying, or the risks involved. The largest robo currently is WealthSimple, which looks like it’s turning into a bank. The outfit has now accepted $100 million in financing from giant financial conglomerate Power Corp., and handed over the chairman-of-the-board position to Power’s boss, Paul Demarais III. No moister there.

WS has also expanded its socially pure fund platform into the US, where its clients are (on average) about a decade older than in Canada, and where robos have a much longer and more checkered history than in Canada. There are 30,000 clients and the average amount invested is roughly $33,000. That compares with the average of about twenty times more per investor at a bank-owned wealth management firm like Nesbitt Burns (BMO).

So, are robos good or dangerous?

In a word, good. Better than doing nothing, spending all your money, not thinking about investing and putting everything you’ve got into a condo down payment. Robos are relatively cheap, and some of them even offer a kind of ‘concierge’ advisor service which means you can call and ask generic questions. Also a good thing.

For people with less than a hundred grand to invest, a robo-advisor’s a sound option – superior to being seduced into a scuzzy mutual fund portfolio by [email protected] And a fee-based advisor would be hard-pressed to serve you in a low-fee way with less than about $150,000 to work with. Above that amount, getting an actual human being to help with a tailored portfolio, tax avoidance advice and a long-term plan is well worth the extra half-percentage point.

But, of course, you can do it yourself and save the fee, however skinny it seems. (The same can be said of the ‘balanced’ funds the Fruit People offer at an expensive 1.07%.) Open a TFSA with an online gig like Scotia iTrade, Questrade, TD Direct, BMO InvestorLine or CIBC Investor’sEdge and build a balanced portfolio with four ETFs – Canadian and US large caps stocks, preferreds and short bonds. That should provide enough octane to keep moister net worth growing but with sufficient balance so you don’t freak and call it quits when markets correct.

The next step, when the portfolio climbs well over six figures, is finding a fee-based guy. Sure, you can stick with the DIY balanced approached and probably do just fine, but as your finances improve it makes great sense to seek out ways to minimize taxes. Income splitting. Tax-efficient capital gains and dividend income generation. Spousal contributions and loans. Incorporations and trusts. Registered plan meltdowns. You know, all that stuff you thought was rich-guy and grossly unfair when you didn’t have money.

Being young, frugal, socially responsible and morally superior is cool. But you’ll get over it.

 

127 comments ↓

#1 Party on Garth on 11.13.17 at 5:24 pm

“Still, if you want the eagle-eye view of how frequently governments spend on you, but bill your kids and grandkids—even if you are 20 years old and have neither yet—here’s the rundown.”

The red in our Maple Leaf is for chronic deficits

http://www.macleans.ca/politics/the-red-in-our-maple-leaf-is-for-chronic-deficits/

#2 For those about to flop... on 11.13.17 at 5:27 pm

Instead of watching ” The World Series “between two American teams it’s much more fun to watch American cities outperform whole countries.

Best of 7.

New York area versus Canada.

U.S eh?

My last memory of New York was the TSA agent checking out my plaid boxer shorts after she confiscated my belt and I told her my pants were too baggy to stay up as she ordered my hands above my head.

Don’t recall having to ever take my belt off before this trip ,but pretty standard now.

In hindsight, it probably wasn’t to best idea to go to New York pretty much one year after 9/11.

I no longer wear plaid boxers,just in case I get caught with my pants down…

M43BC

“How the Economic Power of American Cities Compares to Entire Countries

“When America sneezes, the rest of the world catches a cold.” This cliché is often cited to explain how economies around the world react to events in the United States. As you might expect, there’s a kernel of truth hiding behind the cliché, and part of the explanation has to do with the relative size of the American economy compared to the rest of the world. Take a look at our new map to see what we mean.”

Here’s a list of the top ten largest metro area economies in the U.S. together with their international counterparts (with GDP listed in USD millions).

1. New York-Newark-Jersey City, NY-NJ-PA – $1,426,027 vs. Canada – $1,529,760

2. Los Angeles-Long Beach-Anaheim, CA – $884,836 vs. Turkey – $857,749

3. Chicago-Naperville-Elgin, IL-IN-WI – $568,969 vs. Argentina – $545,866

4. Dallas-Fort Worth-Arlington, TX – $471,278 vs. Poland – $469,509

5. Washington-Arlington-Alexandria, DC-VA-MD-WV – $449,293 vs. Belgium – $466,366

6. Houston-The Woodlands-Sugar Land, TX – $442,458 vs. Thailand – $406,840

7. San Francisco-Oakland-Hayward, CA – $406,294 vs. Nigeria – $405,083

8. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD – $381,332 vs. Austria – $386,428

9. Boston-Cambridge-Newton, MA-NH – $371,577 vs. Norway – $370,557

10. Atlanta-Sandy Springs-Roswell, GA – $320,171 vs. Hong Kong SAR, China – $320,912

https://howmuch.net/articles/the-economic-size-of-metro-areas-compared-to-countries

#3 mitzerboy aka queencitykidd on 11.13.17 at 5:34 pm

my dog would sleep like that on my couch
he had a little Spitz in him too … smarter then a fifth grader

#4 Invest in Canada on 11.13.17 at 5:35 pm

I confess that I got this idea from a visiting diplomat from a certain low-lying island in the Pacific. Folks, haul out your Rand McNally and turn to page 12 . What you see a broad swath of the God-forsaken wasteland we call Canada. Next door to the majestic Rockies is the Pacific Ocean.

Now imagine, for a moment, that the eggheads are right and Global Warming is real. Or, conversely, imagine they are dead wrong. In my scenario it doesn’t matter one IOTA. We are sitting on the mother lode of a virtually inhabitable land mass. Some of you may be thinking, “Yeah, but don’t we need Mother Nature’s help to bring on the Great Flood?” That would help, obviously, but we can still profit from the fear that is palpable in every papaya producing principality in the Pacific.

Our beloved Justin is already on point, shaking his tail feathers like a pro. All we need now is a positive, gender neutral message that reads something like this: “Buy a piece of Canada, and keep it for a rainy day.”
I’ll come straight to the point. I need seed capital to get this project off the ground. Serious investors only please.

PS Is anyone here acquainted with a Rupert from Rupert’s Land? My atlas is kinda old. Is he in a home somewhere, or deceased? Thanks.

#5 paracho on 11.13.17 at 5:36 pm

Once again …. great advice !

#6 SB on 11.13.17 at 5:44 pm

Or, keep your money at a robo and hire a fee-for-service financial planner to help you with minimizing taxes, asset allocation, estate planning, insurance advice and all the other decisions involved around your money.
P.S. Typo in the 5th paragraph, first word (Rob). You’re welcome.

#7 The Technical Analyst, CSTA, CPD on 11.13.17 at 5:51 pm

ETF’s are cheap, but lack ANY downside portfolio protection. You ride the market/sector up 100% and you ride it down 100%.

Garth says “The same can be said of the ‘balanced’ funds the Fruit People offer at an expensive 1.07%”. 1% is hardly expensive for an active portfolio that can save you 10% downside in a orrection. Remember, corrections occur on-average, every year.

So, save the .5% and learn to time the market or pay the extra .5% and relax.

#8 JWEV on 11.13.17 at 5:52 pm

first

#9 Dimitri is the Leader on 11.13.17 at 5:58 pm

True….Female Millennial co-workers are a walking lawsuit, but if you don’t hire them in administrative, paper-pushing careers, they complain to the human rights tribunal.

But ya don’t see immigrant women of colour and visible minorities getting those paper-pushing jobs when you factor in that at least 40-55% of the workforce in the Greater Toronto metropolis are of colour.

#10 Ace Goodheart on 11.13.17 at 6:24 pm

RE: Robo advisors:

What in the world is the harm of simply picking solid, well run companies, running their metrics and if things check out, then purchasing their shares?

#11 Harvey on 11.13.17 at 6:28 pm

yup, home prices are definitely rising because this blog can’t stop promoting the benefits of financial assets. The stock market is at the edge of an abyss so it’s a great time to invest!

What abyss? — Garth

#12 HoweStreet.com on 11.13.17 at 6:28 pm

Ross Kay on HoweStreet.com Radio:
Banks Using “New Rules” to Grab Mortgage Cash Now.
Toronto Star’s “Ask Joe” Doesn’t Know Jack About Real Estate.

http://www.howestreet.com/2017/11/13/banks-using-new-rules-to-grab-mortgage-cash-now/

#13 Keith in Rio on 11.13.17 at 6:32 pm

I prefer the term……”SJW millenial snowflake”……as it is much more accurate, and even more derogatory.

#14 Adam on 11.13.17 at 6:34 pm

#7 The Technical Analyst, CSTA, CPD on 11.13.17 at 5:51 pm

1% is hardly expensive for an active portfolio that can save you 10% downside in a orrection. Remember, corrections occur on-average, every year.

———–

The problem is, it’s active management and while it might save you 10% on the downside during a correction, it’ll likely cost you at least that much again in missed gains on the upside, because nobody can call a bottom without the benefit of hindsight.

#15 jess on 11.13.17 at 6:35 pm

dimitri

the “bro” economy
sex tape reveals maldives judge having sex with three women gets promoted as chief of the judical service commission!!!! this is the same place where women get flogged for having sex outside of marriage!

and then the “bro’s”says it has been treated ‘unjustly and unfairly’ amid human rights scrutiny and money laundering rumours

#16 please clarify? on 11.13.17 at 6:45 pm

‘The next step, when the portfolio climbs well over six figures, is finding a fee-based guy.’

what is the difference between ‘fee-based’ and ‘flat-fee’? are they the same?

Fee-based advisors build and maintain portfolios and enact plans. Flat-fee guys give advice. — Garth

#17 Cherry Picker on 11.13.17 at 6:51 pm

You make it sound like the gray beard boomers are wiser for using algorithms less, but I bet they use a lot more very expensive mutual funds than the millennials, so maybe the algorithms lovers are relatively better off.

Also three ETFs is better than four. Global, Bond, Canadian – less re-balancing required.

#18 Willy H on 11.13.17 at 6:54 pm

“In this case I was labeled paleo.”

Classic ageism from a generation set-up to fail:

https://www.theatlantic.com/magazine/archive/2017/09/has-the-smartphone-destroyed-a-generation/534198/

http://www.independent.co.uk/life-style/gadgets-and-tech/facebook-like-inventor-deletes-app-iphone-justin-rosenstein-addiction-fears-a7986566.html

#19 Linda on 11.13.17 at 7:19 pm

Regarding the ‘robo-advisor’. Some questions – how safe is that code from hackers/malware? Does the robo-advisor have the power to sell on your behalf as well as buy? Because even with human oversight (finger poised over an ‘Abort!’ button) by the time that finger presses down todays computers could have made many, many decisions/trades which might or might not benefit one’s portfolio.

After all, if the robo-advisor is run by an algorithm or code, who wrote that code? Is it ever updated to reflect current reality or is it just the robotic version of the year in which it was created? And how the heck do you take an algorithm to court?

#20 tccontrarian on 11.13.17 at 7:27 pm

One of the most underappreciated but most relevant factors: timing!
I provide blog dogs with 3 links to articles worth a read – by anyone thinking about where we are, and where we might be headed.
BTW, I hope I’m not violating any of GF’s posting rules:

1. Why The Next Stock Market Crash Will Be Faster And Bigger Than Ever Before
http://www.zerohedge.com/news/2017-10-23/why-next-stock-market-crash-will-be-faster-and-bigger-ever

2. The Biggest Ponzi in Human History
https://www.theautomaticearth.com/2017/11/the-biggest-ponzi-in-human-history/

3. Into the Great Wide Open
http://www.marketanthropology.com/2017/11/into-great-wide-open.html

Enjoy!

TCC

#21 matt on 11.13.17 at 7:28 pm

In a future blog post, could you talk about credit quality in bond ETF(s)? I was trying to convince my uncle to switch his MD Stable bond/mortgage fund charging 0.85% per year and yielding 2%, for the BMO etf ZCS, which yields a bit more after costs, but my uncle outsmarted me. He found that ZCS has double the amount of BBB bonds and 50% less AAA bonds.

I realize this may be too “low-level” for your readers. Well, is it? Maybe it’s time to take the next step?

Thanks

#22 correct on 11.13.17 at 7:31 pm

ETF’s are cheap, but lack ANY downside portfolio protection. You ride the market/sector up 100% and you ride it down 100%.

Garth says “The same can be said of the ‘balanced’ funds the Fruit People offer at an expensive 1.07%”. 1% is hardly expensive for an active portfolio that can save you 10% downside in a orrection. Remember, corrections occur on-average, every year.

So, save the .5% and learn to time the market or pay the extra .5% and relax.

………….

mutual funds are a bad word at this site…..hey look etf’s are now creating ‘balanced etfs’; mer’s approaching 1% so fresh there’s no historical data. if ya want alpha/sharpe ratio/beta data? come back in 5 yrs

#23 Last of the Boomers on 11.13.17 at 7:33 pm

Just watched a documentary on the paradise papers which laid out the business plan of how the Canadian scalper, julien lava lay ( spelt incorrectly on purpose), operates and built his ticket scalping empire. I realized it is no different than the way realtors, real estate developers, and speculators have laid out and have successfully accomplished the real estate Ponzi scheme model here in the larger cities in Canada. Find the documentary and watch it, simply substitute the word “speculator” for “scalper” and “house” instead of the word ” concert ticket”. The revelation will hit youlike a ton of bricks! Now while scalping is illegal, speculation in real estate is not. How ridiculous is that! Write to your politicians (local, provincial, and federal). we need to lay it out for them and propose solutions.

#24 down_boy on 11.13.17 at 7:39 pm

fyi: Notice received from payment service Paypal to business customers:

“We’re writing to notify you that we have received a Federal Court order requiring us to disclose information to the Canada Revenue Agency (CRA) about PayPal Business account holders who sent or received a payment between January 1, 2014, and November 10, 2017. To comply with the order, PayPal Canada will make a disclosure to the CRA within 45 days of the date of the order.”

Likewise, make sure your investments are “earth-friendly”. As times change, they may come back to bite you. Pollution tribunals could very well become the second Inquisition.

#25 R on 11.13.17 at 7:42 pm

Is the fee one time or paid annually

#26 For those about to flop... on 11.13.17 at 7:44 pm

Annie,are you o.k?

Are you o.k Annie…

M43BC

http://www.macleans.ca/economy/realestateeconomy/how-canadian-homes-became-debt-traps/amp/

#27 LivinLarge on 11.13.17 at 7:45 pm

I’m sold Fearless Leader.
Now, can your 3rd largest in North America fee for service advisory arrange an Amex Black card and get short notice reservations at Bocuse or Trois Gross in Lyon?
If you can, I’m in. I’m tired of watching markets, reading reports and analyzing financial statements. I just want to put everything in the hands of someone who enjoys that work and can ensure a tax advantaged income sent monthly to my Swiss or French bank.

#28 Robo Guy on 11.13.17 at 7:55 pm

Best post of the year. Its just plain embarrassing to get the “oh, your looking to invest ONLY that much?” – the financially educated like yourself are used to pushing lots of $$ around, and we both know that we are wasting your time with our pitiful 20K.

You’ll hear from me when it’s over 150K.

#29 conan on 11.13.17 at 7:55 pm

I am in the money biz, the dollar side of insurance, to be exact. My clients know what they are paying in fees and they know what they could save in fees by buying ETF index funds.

As long as I stay competitive in the return department, they stay with me. My products have various levels of insurance wraps that older investors find very attractive.

Most of the advice that I give my clients is not even money related. I am asked for advice on all sorts of matters.

https://youtu.be/M34oFcP_iMs?t=7

#30 El Jako on 11.13.17 at 8:00 pm

DELETED

#31 LivinLarge on 11.13.17 at 8:05 pm

R
“Is the fee one time or paid annually?” or monthly an annualized rate?

Fee-based advisors are paid to build and run a portfolio and enact a plan. There is usually a monthly payment from the accounts, which adds up to 1% by the end of the year. — Garth

#32 jess on 11.13.17 at 8:06 pm

Germany’s Commerzbank (CBKG.DE) has become the target of a tax evasion probe in which several current and former managers are suspected of evading 40 million euros (35.59 million pounds) in taxes via so-called dividend stripping.

english version
Number of finance ministers who could have put a stop to the tax theft during their tenures: 4
http://www.zeit.de/wirtschaft/2017-06/cum-ex-scandal-tax-evasion-dividend-stripping-germany

#33 Long-Time Lurker on 11.13.17 at 8:12 pm

I appreciate the intelligent feedback from yesterday. It’s always good to get another perspective.

Karma’s real. Pay-back’s a @#%!. I just saw it today. (Not me)

#34 will on 11.13.17 at 8:17 pm

Paleo.

Love it.

#35 Lisa on 11.13.17 at 8:24 pm

For those about to flop..
I’m glad you remember Retired Boomer too! I liked him!

Robo Guy:
I’m with you…I don’t have a $150K investment portfolio either. I didn’t realize Garth was such a high roller.

Thanks for the tip, Garth. I never would have thought of a robot investor.

I try to help everyone I can, which is why you are reading a free blog. But the economics are that in order to enjoy a low 1% fee investors should have that amount to engage a fee-based company. The banks not cut off their ‘wealth management’ fee-based advisors at $250,000. I’m a low-roller. — Garth

#36 akashic record on 11.13.17 at 8:34 pm

Alibaba had a record Single Day sale on Saturday, USD25.3 billion, broke last year’s record “by lunchtime”.

On Monday BABA closes down USD -1.87

Go figure.

#37 Potato on 11.13.17 at 8:43 pm

@ #19:

“Regarding the ‘robo-advisor’. Some questions – [..] Does the robo-advisor have the power to sell on your behalf as well as buy?”

Yes. This is needed sometimes for rebalancing.

“After all, if the robo-advisor is run by an algorithm or code, who wrote that code? Is it ever updated to reflect current reality or is it just the robotic version of the year in which it was created?”

Not sure what you’re worried about changing. Not all “robo-advisors” are the same, but most are not using their software to make active investment selections. Instead, humans design the model portfolios (typically made up of 7-12 ETFs), and the automation part just makes sure that each biweekly contribution is distributed to meet the allocation for each client, and is rebalanced to a new allocation when the portfolio manager makes a change. Not much in the code that would need to adapt there.

For the ones that use AI for tactical asset management, well, the AI is supposed to be constantly learning and adapting to changing situations (but it looks like at this time the signals are just given to human portfolio managers to approve changes in sector weights).

#38 TRUMP on 11.13.17 at 8:46 pm

I am taking my advice from MORNEAU-SHEPELL

The best investments are tax-efficient and this outfit knows how to beat CRA at their own game.

Disclosure: Did I mention our Finance Minister…..the Cheater-In-Chief may have some involvement with this company.

#39 yorkville renter on 11.13.17 at 8:57 pm

#23 – I read an article on this, and I’m SO MAD at the anti-competitive, untrustworthy and ultimately dishonest work that StubHub and TicketMaster are part of… it’s not even abourlt complacency – they seek out pro scalpers to their benefit.

It’s outrageous and needs to be stopped

#40 Smoking Man on 11.13.17 at 8:58 pm

Garth have some compassion from millenials born after 1994. Teachers is all I’m saying.

Poor kittens. No voice to scratch with. Definaltly no bark.
Just howals of insanity is there guiding principle.

Logic was diligently removed from their education.

#41 Perspective on 11.13.17 at 9:01 pm

Every fall and late winter of my adolescence was spent hunting the fields and ponds of Alberta with my father and my Uncle Sam. Sam was a vet that rarely spoke of the Second World War, except when very drunk on November on 11th. In that advanced state of drunkenness, he told a story many times of a day in Holland when he killed three German soldiers. You see he and his buddy where roaming the fields of Holland looking for a broken down tank when they saw what they thought to be three American soldiers approaching in a Jeep. At this point in the war the Germans were using American uniforms to breach the Canadian lines. His accomplice approached the Germans and Sam took cover. The German’s killed his friend, and Sam killed all three Germans. Sam’s guilt was not the result of killing the Germans, it was the result of having survived. Alcohol was Sam’s reprieve and Sam’s doctor told him late in his life that he needed to stop drinking. Sam’s reply was that he had seen more old drunks than old doctors and he kept right on drinking. Sam died of Lung Cancer in 1979. As I have driven across Alberta I often think of Sam. Frankly, I doubt anyone could really understand unless you were there.

#42 MPAC on 11.13.17 at 9:02 pm

Question Garth or blog dogs:

Wife and I, 37 & 39, have approximately (with CIBC Investors Edge):

145K in a LIRA
35k in an RRSP
70k in a TFSA
45K in a RESP

Can I transfer all of the above accounts to a fee based adviser(I know i can transfer the TFSA)?

We both have DB plans as well.

Thanks.

Of course. — Garth

#43 Smoking Man on 11.13.17 at 9:03 pm

Millenials born after the AL Gore road show.

Climate change is real but not enough humans walking the earth to affect it in any way. More carbon breathing trees , pot plants and corn feilds then evil humans farters.

Stop planing to murder your parents, they love you. Your teachers not so much.

#44 D.D. Corkum on 11.13.17 at 9:04 pm

#7 The Technical Analyst, CSTA, CPD on 11.13.17 at 5:51 pm

“ETF’s […] lack ANY downside portfolio protection….”

If you are going all-in on a single index, sure. What stops people from using ETFs to diversify into wholly different asset classes?

#45 Millen Neo on 11.13.17 at 9:12 pm

Been very happy with my robo. {Fees + MER on the ETFs} = 0.35% combined. Flat-fee, too, this 0.35% fee will only decrease with time. They’ve saved me about $10,000 in fees in the past year alone compared to a conventional bank. The portfolio they’ve customized for me includes ~22% bond ETFs.

#46 45north on 11.13.17 at 9:25 pm

I’m complaining about a post. It’s not mine!

“ovens”

this comment needs to be deleted

#47 Lost...but not leased on 11.13.17 at 9:29 pm

#30

Not only is that comment in extremely poor taste, suffice it to say that a REAL jury would find the inferences groundless.

$500 for a phone call? – Garth

#48 n1tro on 11.13.17 at 9:36 pm

Garth,

I think it has been awhile since you worked with debt slaves that your comment….

“But making such an observation today is like telling a female co-worker she looks beautiful this morning. Soon you’re sitting in HR accused of assault.”

is out of touch. You will be sitting in HR if you don’t tell her she looks beautiful this morning because her feelings are hurt!

#49 White Crock BC on 11.13.17 at 9:38 pm

Smoking Man on 11.13.17 at 9:03 pm

Millenials born after the AL Gore road show.

Climate change is real but not enough humans walking the earth to affect it in any way.

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

That’s the problem: They’re not walking.

Go to marinetraffic.com and see how many ships there are out there on the high seas at any given time

flightradar24.com and see how many jet aircraft are flying around up there at any given time

Then think about all the cars, trucks, buses… every single day… 24 hours a day…

#50 FOUR FINGERS WATSON on 11.13.17 at 9:46 pm

#43 Smoking Man on 11.13.17 at 9:03 pm
Millenials born after the AL Gore road show.

Climate change is real but not enough humans walking the earth to affect it in any way. More carbon breathing trees , pot plants and corn feilds then evil humans farters.

Stop planing to murder your parents, they love you. Your teachers not so much.
…………………..

Hey Smoky, that was fun at the Mud Pit last night. I love watchin’ those dwarves ‘rassle. I thought you were gonna win till you got choked out there at the end. Are you still seeing those little space ships ?

#51 Basil Fawlty on 11.13.17 at 9:47 pm

Garth asks what abyss?

The Swiss Central Bank holds $88B in US stocks and they are rated as the worlds 8th largest public investor. The Bank of Japan holds 75% of Japanese ETF’s.

#52 Newcomer on 11.13.17 at 9:49 pm

#24 down_boy on 11.13.17 at 7:39 pm

….
“To comply with the order, PayPal Canada will make a disclosure to the CRA within 45 days of the date of the order.”

Lazy bastards. They ignore hundreds of millions in tax evasion involving principle residence exceptions but go after waiter’s tips and Etsy crafters because they know it’s easy and the people are too poor to fight back.

#53 Loonie Doctor on 11.13.17 at 9:50 pm

Seems a robo advisor with concierge may be a way to start if you don’t have enough money for a fee-based advisor. I wonder how good the advisors are though. You often get what you pay for. I would have hard time paying 0.5% to a robot if I wasn’t getting the value added advice for my fee to just invest in a balanced portfolio of ETFs.

#54 Lisa on 11.13.17 at 10:01 pm

I try to help everyone I can, which is why you are reading a free blog. But the economics are that in order to enjoy a low 1% fee investors should have that amount to engage a fee-based company. The banks now cut off their ‘wealth management’ fee-based advisors at $250,000. I’m a low-roller. — Garth
==========================
My apologies if this Cro-Magnon woman sounded bitter. I took my tin foil hat off earlier and now I can’t think straight.
I’ve been reading this free blog for 6 years now and it is rare that I can laugh AND learn at the same time. So thanks.
I’ve heard some folks here talk about Robo Investors but I didn’t really know what they were. This was in the same breath as Bitcoin mind you, so I skipped past those.

#55 Chung Ho on 11.13.17 at 10:02 pm

Silent Invasion: How China is turning Australia into a puppet state
http://cnnmon.ie/2ACTC8s

I wonder is China is doing the silent invasion to Canada, with so many people buying houses with money from China. Granted, many could be legal residents of Canada, but still the money could have been lent with political motivations.

#56 86dpunter on 11.13.17 at 10:05 pm

Garth

Are you subtly telling anyone with less than 6 figs to politely p*ss off?

Nope. Just informational. – Garth

#57 Manitoba Whale on 11.13.17 at 10:08 pm

#1 Party on Garth on 11.13.17 at 5:24 pm
The red in our Maple Leaf is for chronic deficits

http://www.macleans.ca/politics/the-red-in-our-maple-leaf-is-for-chronic-deficits/

—–
Sad.
I still think that in good times you pay down debt, no matter what the GDP/debt ratio is. I have no proof, no evidence, no stats to back me up on a national macro scale. It just worked at a personal/corporate level. In the end I do not have access to the same levers as our government does. I rest my case and accept defeat.

This is the new normal. I guess we will have to trust TBTB.

Binge baby binge.

#58 Please delete #30 on 11.13.17 at 10:10 pm

Offensive and inappropriate.

Agreed and deleted. – Garth

#59 Royal City Dweller on 11.13.17 at 10:21 pm

Wife and I both 59;
$200K in cash and RRSPs in the bank
$80K in group RRSPs
$500K available from HELOC for investing
No debts.
Can I transfer all of it to a Fee Based Advisor. And how?
Should I use HELOC?
Thanks

#60 Flat fee on 11.13.17 at 10:22 pm

If you’re a high net worth individual and enjoy DIY flat -fee is the way to go . Get another set of eyes and save THOUSANDS .

Over a 10 yr period ? Just do the math . Amazing .

#61 Harry Palmer on 11.13.17 at 10:25 pm

#30 – Somewhat amazed that our host/moderator let your thoughts remain on display.

#62 AfterTheHouseSold on 11.13.17 at 10:28 pm

#30 El jacko “ovens”
“They just threw the wrong people in”.

Agree with #45north and others. This comment is in very poor taste and should be removed. Did this one slip by you Garth?

Yes it did. Now deleted. My apologies. – Garth

#63 Nonplused on 11.13.17 at 10:51 pm

Well let’s face it Garth, we live in a world where people go to gaming conventions and then watch the finalists duel it out on screen, as if it’s a sporting event. My son probably splits his time 50/50 playing Minecraft and watching videos of someone else playing Minecraft but who knows more of the tricks.

It’s not here yet, but it seems that the day is approaching and sci-fi will become real-time soon enough. You car will drive itself, airplanes mostly fly themselves already, factories won’t have any people in them, and you can print yourself a working gun in your own home with $2000 worth of equipment that plugs into your computer. Or why stop at one, print a box of guns and sell them at the farmer’s market.

Eventually the robo-investors won’t even be able to charge 0.5% because once that software gets “out there” pretty good versions will be available for less than Microsoft Office. That’s the problem with software, all the costs are up front and once it’s working you can mass produce it with a few clicks of the mouse.

When I graduated from university in 1990, which seems like a long time ago now, I could have never envisioned that we would all have a studio quality video editor on our phones. Heck we didn’t even have cell phones at that point. Well we did, but they were as big as a brick and only did the phone thing. And they costed way more than an iPhone X even without counting for inflation.

We are moving closer and closer bit by bit towards the point where there just won’t be that much left for people to do. No jobs. I mean, this has been going on since they invented the washing machine, but it keeps on going. Even in my own career of late my chief occupation has been designing a way for computers to do things so people don’t have to.

There is, of course, much written about the subject and what is to become of society if we get to a point where a few people own the machines and most everyone else is unemployed. We aren’t there yet, but the writing is on the wall.

#64 LivinLarge on 11.13.17 at 10:53 pm

“Fee-based advisors are paid to build and run a portfolio and enact a plan. There is usually a monthly payment from the accounts, which adds up to 1% by the end of the year”…so, in a word yes. Monthly annualized to a yearly 1%. As should be obvious from my previous post, that seems a reasonable price to pay a skilled and qualified professional.

#65 Ryan S. on 11.13.17 at 10:57 pm

DELETED

#66 Dmitry on 11.13.17 at 11:21 pm

#63 Nonplused

Even though I could pay for and buy whatever I wanted, I still enjoy doing things myself – renos, car repairs/maintenance, pool opening/closing, yard works, small/big appliances repair, electronic repairs, etc. It’s do easy to do nowadays with Google, YouTube, etc.
Anyone can try to do all these things at home, just stop being lazy and waste time on social networks.
Delete accounts at all these Facebooks and the rest of LinkedIns and other crap ASAP people!

#67 Notagreaterfool on 11.13.17 at 11:21 pm

Here now come the robot planners

https://www.viviplan.com

$500 for a phone call? – Garth

#68 When you have 6 figures.. on 11.13.17 at 11:46 pm

“The next step, when the portfolio climbs well over six figures, is finding a fee-based guy. Sure, you can stick with the DIY balanced approached and probably do just fine, but as your finances improve it makes great sense to seek out ways to minimize taxes. Income splitting. Tax-efficient capital gains and dividend income generation. Spousal contributions and loans. Incorporations and trusts. Registered plan meltdowns.”

Did all that and more with the help of accountants, tax lawyers, notary firms, wealth managers, and lawyers. But perhaps that is more suitable for when you have 7 or more figures :-)

Love paying fees, don’t you? – Garth

#69 Adrian on 11.13.17 at 11:50 pm

#57 Manitoba Whale on 11.13.17 at 10:08 pm

I posted this comment on Saturday, but it addresses your confusion. The video is ~26 minutes, with the first half or so being the most relevant for you.

***

At the macroeconomic scale, one person’s expenses are another person’s income, and sectoral balances mean that in order for one sector to save another must run a deficit. Unless a country is running a significant trade surplus to outsource its money creation needs (e.g. Canada during the ’90s) sovereign government deficits are necessary for the proper functioning of a growing capitalist economy. Professor Steve Keen explains here:

How Austerity Works
https://youtu.be/0y5rP56OX78

#70 Royal City Dweller on 11.13.17 at 11:55 pm

Again:
– Should I use HELOC to come up with investments funds?
Yes? No? Depends?

Definitely depends. Leverage magnifies gains & losses. Use it carefully. But interest is cheap and tax-deductible. Talk it out with someone. – Garth

#71 Evangeline on 11.14.17 at 12:24 am

Hallelujah Veterans Version

https://www.youtube.com/watch?v=msYPbjFC50w

#72 Nonplused on 11.14.17 at 1:19 am

#66 Dmitry

Agree. Just recently fixed my vacu-flow hose that my cleaning lady had broken or perhaps it wore out. Had to cut a couple inches that we split off and redo the wires. Probably spent enough time that it I should have just bought a new one but I hate that idea. If I can fix it I do.

But then one of my co-workers down in the US, young guy, was trying to keep his 2000 BMW roadworthy according to the laws where he lives, and it’s all about emissions now they don’t give a crap if the brakes work. He’d bought the computer reader, replaced all the sensors it said were no good, and eventually spent as much as the car was worth just replacing sensors before he just gave up. It was running fine the whole time and not burning any oil. It’s on the way to the junkyard now because it can’t pass an emissions test and nobody can figure out what’s wrong with it even using the computer. And it’s not the emissions. They are fine. They are failing the vehicle because of unresolved computer codes. Codes the computer cannot identify the problem for. Probably just corroded wires, I don’t think anything is wrong with the car.

Technology is going the way. We can all fix are computers now, but we do it by replacing an expensive part wholesale, and that part isn’t a part it’s a whole thing of itself. The last major appliance failure I had was a control card going out on a fridge. $350 for the card plus the tech’s fees. Old fridges don’t do that. Oh and then a card went out on my garage heater, another $350 plus tech fees. Older appliances don’t have control cards, and they work just fine. I have a 20 year old fridge now that works just fine but it doesn’t have any control cards. The light doesn’t come on anymore when you open the door but I know it’s the switch because if you play with it the light will come on, but it turns out you don’t really need a light in your fridge, you just need it to be cold.

#73 daniel on 11.14.17 at 1:44 am

Why do you have MY PHOTO OF MY DOG ON YOUR BLOG!!!?????!!!!

#74 daniel on 11.14.17 at 2:25 am

Please disregard my earlier comment, my father in law is a fan and follows your blog, he didn’t tell me he sent you my photo. Thanks for featuring Moose! He’s a real character.

#75 morrey on 11.14.17 at 2:37 am

“How HELOCs Can Hurt You”
google it, read it .
then think hard about it!

#76 Howard on 11.14.17 at 4:22 am

Well, Garth, how much regard for older generations did the Boomers have when they were in their 20s and 30s? You think those psychedelic youth dropping acid at a Doors concert gave a rat’s behind about their parents’ sacrifices during WW2 or their grandparents during WW1 (or both of those previous generations during the Depression)?

Some quotes come to mind, neither of them of Millennial origin:
– “Hope I die before I get old”
– “Never trust anyone over 30”

Millennials can and should do better. This is simply to say that ignorance and indifference of the sacrifices of previous generations is hardly new.

#77 Dharma Bum on 11.14.17 at 6:37 am

“Being young, frugal, socially responsible and morally superior is cool. But you’ll get over it.” – Garth
——————————————————————–

Thank you Garth, for telling it like it is, and elucidating
the sanctimonious self-righteous posturing of the trendy SJW, hipster, wannabe, millennial, holier-than-thou, left-wing, Trudeau loving, politically correct crowd.

It’s time that these know-it-alls heed your practical advice: Save. Invest. Diversify.

Then, they can all eventually stop fretting over minutiae, become Dharma Bums, and wallow in freedom.

#78 Wiggle room on 11.14.17 at 7:13 am

I get that some people are their own worst enemies in terms of panic selling when the market dips. But if you have the self discipline, it’s really not that hard to manage a portfolio yourself. Read this blog, read bogleheads, and once you get the hang of it it is not rocket science. *If you are disciplined.*

But I get it, most people don’t want to be bothered with managing their money. I find it mind boggling that they don’t, but it’s just a sad fact. They just don’t care enough to learn. The people who read this blog, though, can probably DIY it. Have some faith in your abilities, people!

#79 #Me Zwei on 11.14.17 at 7:37 am

Brothers and ……… Sisters (really?), I accidentally exposed myself to a harlot this past weekend. Some of you may know her as the frontispiece to a US alt-right site. I won’t divulge her name lest you be tempted, let’s just call her Pandora.

I was preparing my Sunday sermon and hit upon a blog much like this one, but full of well-written, witty prose. Now, I can usually spot a neo-Nazi from a km away, but these Beezlebubs make Goebells look like a romance writer. So smooth was their delivery, so faultless their logic. But then I had a visceral sensation, and my autoimmune system took over.

I suppose if I had deigned to look in Pandora’s box and read the comments the microbes would have jumped off the page. I did not go there. And yet, when I came here to my safe place the nausea returned when I read the post by …… it’s gone now …. was it a Jacob? But the hum of the virus is still in my head like my old Philco radio. Maybe I should just throw it out, but does anybody here fix radios? Anyway, what has befallen Jacob is anybody’s guess. Was it some raw cookie dough or a subservient relationship with a Lithuanian dance hall girl ? Ask me if I care. I am not one to judge, but if Garth spent a little less time on his day job maybe we would have a little more civility here. Amen.

#80 Mike in Toronto on 11.14.17 at 7:47 am

#37 Potato

“For the ones that use AI for tactical asset management,…”

I would hate to confuse robo-advisors and alorithmic trading. The former is much as you describe, trying to emulate the strategies of a sane financial advisor, tailored to a few risk profiles. The later is something else entirely.

I have a small portfolio in WealthSimple. It seems to be doing a couch potato strategy with automatic rebalancing. It buys, it sells, it’s very, very boring. The fund selection is interesting and taught me a bit about my own choices in my own portfolio, although it is not that different.

It’s more disciplined in rebalancing, knows more about sector weighting, and doesn’t seem to make the kind of stupid mistakes I make. I should probably shove everything in there.

#81 crowdedelevatorfartz on 11.14.17 at 8:29 am

@#72 Nonplused
“Old fridges don’t do that….”
******

Total agreement.
Repair vs replace.
The landfills overflow. Parts are unavailable. Planned obsolescence. A $2 part fails and you need a new tv.
Case in point.
This weekend the shower at the apartment started to “water hammer” violently. Very loud. It was the “Balancing valve” faucet that mixed the hot and cold water.
It would take the numbskulls from maintenance a week to show up much less figure it out. I disassembled it. Two tiny springs( smaller than a spring inside a disposable pen) were worn out as were the tiny washers they touched.
Googled the faucet. A Delta “Scald Guard”. No one supplies parts. No one. A USED refurbished replacement could be had on Amazon for $35 and a one week deliver (plus shipping another $40)

Ridiculous….. Scandalous…. Typical….

Took photos on my phone and the tiny parts to Rona. The plumbing rep ther knew exactly what I was talking about and pulled out a parts box…fished out the replacement parts, wrapped them in a piece of plastic and said, “no charge”. I went to the cashier and showed her ht etiny springs and washers, “Have a nice day”
Unreal.
Out of curiousity I went to Home Depot. The guy THERE also fished out the tiny parts and gave them to me “no charge”. The cashier also said , “Dont worry about it”
Off i went.
Fixed the faucett. Works like a charm.

Oh, and as for old Fridges.
My parents bought a Used 1951, Canadian built Fridgidaire when they first married. Owned it for 20 years. They eventually gave it to a neighbor as a spare, to be used as a beer fridge in his garage in the mid 70’s. I visited him a few months ago.
Its still in his garage, full of cold beer.
Its never had any trouble….in 66 years of working.

#82 Herb on 11.14.17 at 8:35 am

But foreign money plays no role!

http://www.cbc.ca/news/business/realestate-canada-houses-1.4400092

Pitts is a career real estate pumper. I guess the bulk of his net worth is… guess where? — Garth

#83 Asterix1 on 11.14.17 at 8:43 am

Good old G&M just keeps on pumping garbage “articles” on Toronto/Vancouver RE.

Latest news from economist Tal at CIBC letting us know that prices are going to go up and up! That B20 will do nothing and the party will keep going. WOW! What a load of crap.

I truly feel that a new regulatory agency should be created to keep these newspapers in line, to stop them from printing anything from banks, real estate agencies, mortgage brokers and the rest of the RE industry. These media companies need cash from the RE industry as badly as a vampire needs blood. They will do (print) anything for a pint of the red stuff!

For crying out loud, Fitch recently downgraded CIBC on “concerns about its exposure to the housing and consumer sectors.”

The Canadian public is being manipulated and no one is doing a thing about it!

#84 Adam on 11.14.17 at 8:55 am

#76 Howard on 11.14.17 at 4:22 am

“Millennials can and should do better. This is simply to say that ignorance and indifference of the sacrifices of previous generations is hardly new.”

Right on Howard. Likewise, distaste of real or supposed arrogance and ignorance of younger generations by older generations is hardly new, too….the cycle continues.

#85 Bytor the Snow Dog on 11.14.17 at 9:03 am

Fine example of “equality” in action.

https://www.reddit.com/r/canada/comments/7crtyb/cra_denies_fathers_ccb/

#86 The Technical Analyst, CSTA, CPD on 11.14.17 at 9:12 am

ETF downside risks are not well understood as the industry presents ETFs in a “they save you money” light rather than a “here are all the risks” light.

#14 Adam on 11.13.17 at 6:34 pm
“The problem is, it’s active management and while it might save you 10% on the downside during a correction, it’ll likely cost you at least that much again in missed gains on the upside, because nobody can call a bottom without the benefit of hindsight.”

Good point. On the flip side, no one can call a top either. Remember, if you lose 10%, you have to “gain” more than 10% to recover. And as a bonus, advisor fees can be written off; lowering active management costs further.

#44 D.D. Corkum on 11.13.17 at 9:04 pm
“If you are going all-in on a single index, sure. What stops people from using ETFs to diversify into wholly different asset classes?”

Very true. You can diversify using ETFs, but you are still 100% in any/each asset class, that is what an ETF delivers. Thus, say you have 5 ETFs bundled in one ETF. You are still 100% in each of the 5 asset classes and will ride each asset class down or up 100%. If it was say, active managed ETF (like Garth’s solution), Garth could pull one of those ETF classes out. But passive, not likely, that is what you save on passive ETF fees.

Thanks for asking Adam and D.D. Corkum.

#87 adios on 11.14.17 at 9:25 am

Venezuela defaulted, moving deeper into crisis. Financial meltdown greater than ’08 is approaching globally

#88 Josh on 11.14.17 at 9:52 am

I hope everyone has seen this video of Wild BIll:
https://www.youtube.com/watch?v=R2rWEZZ7L_k

#89 jerry on 11.14.17 at 10:30 am

“The Fee Based advisor”

The Fee advisor takes his /her 1% of the total value of the managed portfolio, not necessarily on the achieved % gain.

Is there a rule of thumb calculation the investor can use to justify the fee?

A fee advisor could produce annual low returns but claim a high fee for doing so.

How do know that you are paying too much relative to the returns?

Easily, of course. Over time returns should be sufficient to achieve your goals – retirement, kids’ education, real estate purchase etc. You either secure some help (and pay for it) or do it yourself (and give your money to an amateur). Also recall that growing money is not the only thing a good advisor should do for you. Minimizing taxes, helping with insurance, real estate, estate planning or what to do with your kids in the basement, plus structuring an achievable lifetime roadmap, are all part of the reason you might choose to pay 1% a year. Or don’t. Up to you. — Garth

#90 Dogman01 on 11.14.17 at 10:31 am

“Rohner, who is paid SFr4m (£3m), said millennials have been dealt a series of blows including high unemployment, tighter mortgage rules, increased income inequality and reduced pensions. “With baby boomers occupying most of the top jobs and much of the housing, millennials are doing less well than their parents at the same age, especially in relation to income, home ownership and other dimensions of well-being assessed in this report.”

Article seemed relevant:
Almost like Garth wrote it.

https://www.theguardian.com/inequality/2017/nov/14/worlds-richest-wealth-credit-suisse

#91 Dogman01 on 11.14.17 at 10:33 am

and the next paragraph seems even more relevant:

“He said that millennials are much more educated than their parents. But he added: “We expect only a minority of high achievers and those in high demand sectors such a s technology or finance to effectively overcome the ‘millennial disadvantage’.”

#92 aa3 on 11.14.17 at 10:42 am

A few years ago my liberal friends were telling me how wonderful Chavez was for Venezuela. A 21st century socialism, where they had worked out the problems that befell all of the other socialist countries.

It did seem a country that even socialism couldn’t screw up. A country overflowing with oil, and rich in minerals as well and with a substantial educated class.

#93 HaHaHa on 11.14.17 at 11:01 am

#79 Me Zwei or whatever. What? Speak a language us alt right folks can understand.

#94 adios on 11.14.17 at 11:02 am

The International Monetary Fund predicts that inflation in Venezuela will hit 650% this year and 2,300% in 2018.

why? relatively frozen prices on everything from a cup of coffee to a tank of gas in an effort to make goods more affordable for the masses.

This is playing out everywhere. pay attention. Hyperinflation is coming for basic necessities and RE and stock market bubbles will burst

#95 The Limited Sage on 11.14.17 at 11:14 am

It’s telling that CIBC came out with this new housing forecast today… The same CIBC who is most at risk to a housing correction among all Canadian banks.

#96 rainclouds on 11.14.17 at 11:24 am

Christy Clark. In hiding since she was deposed by her own party. Skeletons now coming out of the closet.

http://vancouversun.com/news/local-news/clark-wat-met-hong-kong-developers-while-foreign-investor-debate-roiled-b-c

#97 AB Boxster on 11.14.17 at 11:37 am

The zombie apocalypse is already up us.

No strange virus that kills you and then you rise from the dead as a brain dead monster.

Just millions of mindless zombies constantly staring at their inane apps on their overpriced instantly obsolete devices.

Just think. We now have the ability to instantly know the temperature of the water in your toilet bowl, thanks to the internet enabled privy.

And the world is, of course, a better place for this.

Smart Phones – brain candy for the simple minded masses.

#98 N on 11.14.17 at 11:41 am

The housing markets in Toronto and Vancouver are poised for major long-term price growth as booming demand and inadequate supply overwhelm recent policy efforts to cool those markets, according to a new report from economist Benjamin Tal.
“If you think those cities are unaffordable now, just wait,” Mr. Tal said in an interview. “I think that from a long-term perspective, everything we are doing is temporary. The fundamentals are way too strong offsetting all of that.”

https://beta.theglobeandmail.com/real-estate/the-market/toronto-vancouver-heading-toward-higher-home-prices-despite-new-rules-report/article36946487/

#99 Alex N Calgary on 11.14.17 at 12:35 pm

People were hard on you for the Friday post? really? I thought it was great, you caught the emotion there perfectly, I got slightly teary eyed. People are obsessed with their phones and caught up in their own worlds and a million miles away from things like war, inconcievable, anyways, great post. Irony of course is the people criticizing you of the post are the same people you spoke about and they don’t understand its them.

#100 Calgary Rip Off on 11.14.17 at 12:35 pm

Being under 20 is NOT COOL.

How do I know? I have a daughter. She is 15. She is constantly texting and using Instagram and Snapchat. There are studies showing that all this texting and app use is bad for the brain.

The phrases for the young are “I dont care” and they dont respond as a form of defense.

To the twenty and younger crowd: You are not liked by the people who have been around longer than you. Most of the people in this age(most not all)are clueless. This is aptly demonstrated by YouTube and what videos go “viral”.

Some may argue that many of these youngsters have more money. Money does not determine worth of a person. If it does thats an enormous problem.

#101 Calgary Rip Off on 11.14.17 at 12:37 pm

Garth dont worry about what the Millenials think. Most are idiots.

#102 Smoking Gun on 11.14.17 at 12:42 pm

Nothing to see here folks. BC government knew about the huge role of foreign capital in Vancouver markets while denying its influence publicly.

Because foreign capital has a negligible impact and all that….

http://vancouversun.com/news/local-news/clark-wat-met-hong-kong-developers-while-foreign-investor-debate-roiled-b-c

#103 Newcomer on 11.14.17 at 12:55 pm

#83 Asterix1 on 11.14.17 at 8:43 am

These media companies need cash from the RE industry as badly as a vampire needs blood.
—————

Another way of looking at it is that readers like reading these kinds of articles. Seventy percent of them own real estate and like to be reminded how smart and wealthy they are. A paper that ran articles pointing to risk and uncertainty might win fewer subscribers and social media shares. We tend to think of the media in a top-down way, but people have a lot of choice in what they read, which suggests that it might be better understood as a bottom-up situation. Information bubbles are, at very least, participatory.

#104 IHCTD9 on 11.14.17 at 1:31 pm

#81 crowdedelevatorfartz on 11.14.17 at 8:29 am

Oh, and as for old Fridges.
My parents bought a Used 1951, Canadian built Fridgidaire when they first married. Owned it for 20 years. They eventually gave it to a neighbor as a spare, to be used as a beer fridge in his garage in the mid 70’s. I visited him a few months ago.
Its still in his garage, full of cold beer.
Its never had any trouble….in 66 years of working.
________________________

You sound like my kind of guy fartzy.

I have an old track loader – not my IHC-TD9 – (yes I own multiple dozers). It is 65 years old, and has been to hell and back looking at all the ancient stick welds all over the thing. Manufacturer has been out of business since 1957, no parts available, not even worth trying. This machine is very worth fixing though, and I spent 3 years welding and machining up a new undercarriage. The old parts must have had tens of thousands of hours on them. Those parts really told a story, and I was likely only the second human ever to gaze upon the internal parts since the American factory worker who assembled the unit probably in ’51.

The engine, trans, and final drives looked to be original and untouched. Inside the heavy castings, 90+% of the original Glyptal enamel was still there. I’m not exaggerating when I say some of these components will likely last over 100 years before I’d expect to see any kind of problematic wear.

The engine makes 30 HP, but it weighs over 650 lbs. A mechanical kind of guy like me can’t help but smile and day dream while taking one of these antique machines apart. It’s hard not to end up really liking these old monsters, it’s apparent real quick the philosophy behind the design and construction was much different back then, than today. Everything was hard and ductile – EVERYTHING. Built to last – on purpose.

#105 Vanity on 11.14.17 at 1:48 pm

Today’s Notional Post highlights a case that is before the Nova Scotia judiciary that should greatly concern us all. It seems a Mr Gether has been denied his right to advertise his ignoble Aryan surname on his vanity license plate. Opponents claim this is derogatory toward wymin, while Mr Gether says that’s my name, I like to wear it when I’m out.

While I sympathize with Herr Gether, I can foresee the day when the good people of Halifax are stuck bumper-to-bumper on the John A staring blankly at the Fokkers and Kuntz ahead of them. Isn’t it bad enough that the Jehovah’s are allowed to drive around buck-naked? What price freedom?

#106 Ace Goodheart on 11.14.17 at 2:00 pm

RE: #103 IHCTD9 on 11.14.17 at 1:31 pm

“It’s hard not to end up really liking these old monsters, it’s apparent real quick the philosophy behind the design and construction was much different back then, than today. Everything was hard and ductile – EVERYTHING. Built to last – on purpose.”

We’ve lost all that with the modern stuff. Built to last….for a few years, with planned breakdown and planned obsolence on the horizon.

Reason why I like my old 1986 inboard outboard boat so much when compared to the modern stuff. It is a Chevy V6 with Mercruiser marine bits. Consists of a two barrel carb, a very simple to work on electronic ignition box and a mechanical fuel pump.

I laugh at the neigbours when they have to bring their computerized boats down to Toronto for any problem they might have. These things are closed box, proprietary software deals. You cannot do anything to them other than change the oil (and they are trying to figure out how to stop people from doing that themselves). All four cylinders as well. Run like sewing machines, bumpy and uneven, no power in the low RPMS and everything up high.

My boat cost $1000.00 Theirs cost over $40,000 new. And mine is much better.

And if I decide I don’t have enough horsepower….well, I remove the two barrel carb and replace it with a four barrel. And the wonders of the old Chevy V6 become instantly clear. A 185 horsepower motor is changed magically into a 225 horsepower motor.

Oh well. I can still change the oil on my car.

#107 crowdedelevatorfartz on 11.14.17 at 2:05 pm

@#103 IHCTD9

Ripping apart an old engine that hasn’t been opened since the factory.
======

Reminds me of about 10 years ago.
Got a call from a HVAC mechanic.
He had a midnight repair job for a Friday night and his worker bailed on him.
The job?
A bearing change on two 100hp fan motors inside a 3 ft diameter duct.
He had 12 motors in total to do.
He originally planned on unbolting the air duct and chain hoist/dropping everything to the floor to access the front and back to the motors. ( two 800lb motors per night… He had 12 motors to do).
We get there and I noticed an access panel on top of the duct.
I was able to weasel my way in, squeeze over the motor to access the back side of the fan bearing hub and …voila!
We changed the bearings front and back in an hour. On to the next motor.
They were made in England in the early 1960’s from the markings inside. Original bearings .
Never been opened…….we did 8 motors that night.
He made a $h!tload of money and was able to finish the job the following weekend with another skinny rat “helper”to crawl inside.

I helped him a few more times after that but I don’t like night work so……

#108 Stan Brooks on 11.14.17 at 2:08 pm

#97 N on 11.14.17 at 11:41 am
The housing markets in Toronto and Vancouver are poised for major long-term price growth as booming demand and inadequate supply overwhelm recent policy efforts to cool those markets, according to a new report from economist Benjamin Tal.
“If you think those cities are unaffordable now, just wait,” Mr. Tal said in an interview. “I think that from a long-term perspective, everything we are doing is temporary. The fundamentals are way too strong offsetting all of that.”

https://beta.theglobeandmail.com/real-estate/the-market/toronto-vancouver-heading-toward-higher-home-prices-despite-new-rules-report/article36946487/

—————————————

If that was the case there would be no need for real estate pumpers.

With all due respect Mr. Tal is 2nd category ‘economist’ in a bank whose survival depends on higher house prices.

What is important from long term perspective is that we will continue to become increasingly irrelevant and isolated economically (with the coming demise of NAFTA) country with bad weather, with over indebted population, looming retirement crises and screwed young population.

In 10-15 years there will be no jobs left in these cities.
Period. Unemployed can not pay the mortgage Mr Tal.

#109 NoName on 11.14.17 at 2:13 pm

#99 Calgary Rip Off on 11.14.17 at 12:35 pm
Being under 20 is NOT COOL.

How do I know? I have a daughter. She is 15. She is constantly texting and using Instagram and Snapchat. There are studies showing that all this texting and app use is bad for the brain.

The phrases for the young are “I dont care” and they dont respond as a form of defense.

To the twenty and younger crowd: You are not liked by the people who have been around longer than you. Most of the people in this age(most not all)are clueless. This is aptly demonstrated by YouTube and what videos go “viral”.

Some may argue that many of these youngsters have more money. Money does not determine worth of a person. If it does thats an enormous problem.

____

Funny, exactly same age mine daughter does same here, drives us nuts… Cellphone to her generation is watch was fire to a cave man, many of them will savirly get burned before they learn how to control it.
There is a study out there that shows that after one short interaction with cellphone it takes up to 11 min to get to full concentration on task on hands before cell phone interaction.

And I’ll skip study that show that just having cell phone around will lower your test score. And not to mention teenagers developing chronic neck demages.

Get her to install RealizD app and check usage (track time pickup and duration, during 24hr) after few days. When I checked mine daughters cell I made sure that wife and defibrillator is around and just as a good measure I did sitting on a drive way…

#110 crowdedelevatorfartz on 11.14.17 at 2:19 pm

@#95 rainclouds

That article is so important.
It requires a second posting.

Read and learn Christy Clark supporters.
Read and learn.

http://vancouversun.com/news/local-news/clark-wat-met-hong-kong-developers-while-foreign-investor-debate-roiled-b-c

#111 Stan Brooks on 11.14.17 at 2:20 pm

They want YOUR taxes, not Bill M. or J2’s

https://ca.finance.yahoo.com/news/canadian-tax-evasion-fight-zeros-200239556.html

#112 Stan Brooks on 11.14.17 at 2:32 pm

#108 NoName on 11.14.17 at 2:13 pm
#99 Calgary Rip Off on 11.14.17 at 12:35 pm

It is how the human brain works.
It is called information overload.

To concentrate you need to allocate the sugars/glucose in the blood TEMPORARY to the brain’s important tasks.

The brain adjusts to the workload you give it, in the zombification scenario you expose yourself to CONSTANT information overload and distractions, to keep up you have to either get stimulants or reduce the intensity, i.e. become a veggie.

The last phase is when you simply feel just the need to keep browsing the internet/TV (i.e. ‘stay connected’)
without actually processing the information passed to you.

So inferior when compared to the coming AI. So obsolete.
And who will employ such zombies in the future is beyond me,

#113 Graeme on 11.14.17 at 2:48 pm

“Being young, frugal, socially responsible and morally superior is cool. But you’ll get over it.”

Love it! This will be the line I’ll repeat to my kids and all future generations!

#114 Ace Goodheart on 11.14.17 at 2:58 pm

RE: #86 adios on 11.14.17 at 9:25 am

“Venezuela defaulted, moving deeper into crisis. Financial meltdown greater than ’08 is approaching globally”

Yes, Venezuela, the country that decided the only way to solve its social problems was to nationalize everything. You might as well predict the world is about to end because you just got back from Cuba and no bank will accept your convertible pesos.

Venezuela has been a basket case for years. Chavez started the trip down the slippery slope and now they have achieved terminal velocity.

#115 Blacksheep on 11.14.17 at 3:04 pm

Just for Un-Happy,

“Home sales in B.C. were up in October compared to the same month last year.

The British Columbia Real Estate Association says 8,677 homes were sold last month in B.C., an increase of 19.3 per cent from last year, despite a housing supply crunch.

In Metro Vancouver, the association reports sales were up nearly 35 per cent over the same time period.

Prices continued to rise, however, in Metro Vancouver, with the average price of a home jumping more than 20 per cent to $1,074,834 from $891,705 year over year.

Meantime, the average residential price in the province also rose to $720,129, up 18.7 per cent from October 2016.”

http://vancouversun.com/news/local-news/home-sales-down-in-metro-vancouver-but-up-in-b-c
——————————————
There you go, year over year, as requested

#116 Where's The Money Guido? on 11.14.17 at 3:29 pm

Re:
#39 yorkville renter on 11.13.17 at 8:57 pm
#23 – I read an article on this, and I’m SO MAD at the anti-competitive, untrustworthy and ultimately dishonest work that StubHub and TicketMaster are part of… it’s not even abourlt complacency – they seek out pro scalpers to their benefit.

It’s outrageous and needs to be stopped
+++++++++++++++++++++++++++++++
Just substitute tickets for RE and Stubhub/Ticketmaster for the BC Liberal Gov’t and there you go:

Clark, Wat met Hong Kong developers, while foreign investor debate roiled B.C.

http://theprovince.com/news/local-news/clark-wat-met-hong-kong-developers-while-foreign-investor-debate-roiled-b-c/wcm/4c85ce2b-f68f-43d0-aa54-4bc887617809

#117 Where's The Money Guido? on 11.14.17 at 3:31 pm

#114 Where’s The Money Guido? on 11.14.17 at 3:29 pm

Oops, forgot to thank Sam Cooper for digging up these truths about our wonderful BC Lieberals selling us down the road!

#118 RyYYZ on 11.14.17 at 3:31 pm

#113 Ace Goodheart on 11.14.17 at 2:58 pm

And they, and a lot of their followers, who have “faith” in the powers of Marxism, Chavism, and the socialist revolution, will steadfastly refuse to give up on the glorious revolution, but will only double down on it. They’ll remain convinced that Venezuela’s downfall is all the fault of the US and other western powers keeping them from being successful. Which, actually, they have some point about. Although, most of the sanctions that have hurt Venezuela only came about after they went out of their way to screw over every foreign supplier, creditor, and business partner they had. And started acting very undemocratically.

#119 Lee on 11.14.17 at 3:37 pm

I am sure you have all heard CIBC says real estate in Toronto is going to the moon. Think really really hard about where you think the population of Toronto will be in 2030 because that will probably tel you where real estate prices will be. Don’t be cowed by 5% returns in the stock market.

#120 Yuus bin Haad on 11.14.17 at 3:51 pm

“Fortunately, I don’t care. So let’s continue.”

It pays to check in here every day.

#121 waiting on the westcoast on 11.14.17 at 4:04 pm

If only SCAM were here…

http://business.financialpost.com/personal-finance/family-finance/millennial-money/most-millennials-seen-worse-off-than-parents-despite-aptitude-study

#122 april on 11.14.17 at 4:05 pm

#14 …. you want the truth or RE spin? Listen to Ross Kay at Howestreet.com – Nov 13.

#123 april on 11.14.17 at 4:09 pm

# 97 – Economist don’t have a clue how the RE market works and also work for banks…what does that say?

#124 Blacksheep on 11.14.17 at 4:47 pm

A # 121,

#14 …. you want the truth or RE spin? Listen to Ross Kay at Howestreet.com – Nov 13.
—————————————————-
I of course want to document RE spin, because that is what 95% of the population reads / hears and that’s the group that drives the RE market. Nobody cares what the other fringe 5% read (Ross) because they are, the extreme minority.

I learned about four years ago, being technically correct on fundamentals means sweet F-all when the bears (formerly, your truly included) are left standing on the dock, as their financial RE ship sales away, out of reach forever.

I don’t know why so many struggle to see the obviousness of the situation, especially at this late date……

#125 Guy in Calgary on 11.14.17 at 5:18 pm

#100 Calgary Rip Off on 11.14.17 at 12:37 pm
Garth dont worry about what the Millenials think. Most are idiots”

Millennial here. You sir, are the one that is an idiot. I assume you provide the cell phone? The amount of people with kids I hear complaining about the kid’s cell phone usage when the parents are the one’s paying for the phone is hilarious. Limit their usage if it bothers you but it’s probably easier to give them what they want. Had my first when I was 18 and bought it myself.

Of course, it cannot be the parent’s fault!

#126 Midnights on 11.15.17 at 3:47 am

Jeff Rubin left/got fired because CIBC didn’t like his prediction of oil going over 100 per/barrel.
Just like RBC didn’t like John Embry’s prediction of gold.
Get it right man…

#127 Bottoms_Up on 11.15.17 at 12:09 pm

#4 Invest in Canada on 11.13.17 at 5:35 pm
—————–
Terribly unfortunate that global warming is all too real:

http://www.cbc.ca/1.4395767

Nothing else matters when ecosystems collapse, threatening existence of all life on earth.

What will the next 25 years look like?